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Fewer Chinese cities report home price gains in October
[BEIJING] New home prices in China maintained steady growth in October but fewer cities reported gains, suggesting local authorities could relax some housing curbs as they grapple with a slowing economy.
Average new home prices in China's 70 major cities rose 0.5 per cent in October from the previous month, in line with September's growth and marking the 54th straight month of gains, Reuters calculated based on National Bureau of Statistics (NBS) data on Friday.
Most of the 70 cities surveyed by the NBS still reported monthly price increases for new homes, though the number was down to 50 from 53 in September.
Annual growth also pointed to softness in the sector with home prices rising 7.8 per cent in October, slowing from 8.4 per cent in September and the weakest pace since August last year.
Some analysts say overall signs of weakening in the property sector could give provincial governments an excuse to loosen curbs as economic growth slows to near 30-year lows.
For example, several centres, including lower-tier cities like Nanjing and Tianjin, have eased home purchase curbs as an incentive to attract skilled labour, a move seen by some as a way to boost the local property market.
Price growth in China's mega-cities - Beijing, Shanghai, Shenzhen and Guangzhou - rose 0.1 per ctet from a month earlier, slowing from a 0.4 per cent gain in September, the statistics bureau said in a statement accompanying the data. Beijing, the Chinese capital and home to about 22 million, saw new home prices fall 0.2 per cent on-month.
The modest rise in prices, however, masked mixed trends across the country with some cities showing signs of rapid cooling while others are still plagued with overheating risks.
Xining, a city of 2 million in central China, was the top price performer in the month, rising a robust 2.8 per cent on a monthly basis.
Chinese regulators have vowed not to use the property sector as a way of stimulating the slowing economy given wider concerns about high debt and speculative risks, a contrast to the aggressive easing cycle of 2015-2016.
That suggests a nation-wide reversal in purchase curbs is unlikely, although some analysts expected marginal and city-based relaxation of China's property market policies by the end of this year.
A former central bank adviser earlier this week said China's real estate curbs were appropriate and did not need further tightening.
China's property investment and sales growth both eased to a three-month low in October, data showed on Thursday.
Notably, growth in property transactions slowed during what is traditionally China's "Golden September, Silver October" peak season for new home sales. Sales were hurt by persistent pressures in the sector as a crackdown on speculators showed few signs of abating.
Beijing has recently tightened developer financing channels, especially through trust loans and offshore dollar bonds.
The sluggish market has put pressure on developers to meet their sales targets and many are now offering hefty discounts during the Singles' Day, China's online shopping blitz on Nov 11.