China’s new home prices rise at fastest pace in over 2-1/2 years, survey shows

By Thomson Reuters Mar 31, 2024 | 11:08 PM

BEIJING (Reuters) – New home prices in China rose at the fastest pace in more than two and a half years in March versus a month earlier, a private survey showed on Monday, driven by a slew of supportive steps to prop up the crisis-hit property sector.

The average new home price across 100 cities rose 0.27% on month in March, the biggest rise since July 2021, showed data from real estate researcher China Index Academy. That compared with a 0.14% on-month gain in February.

China’s property sector, a pillar of the economy, has lurched from one crisis to another since 2021 after a regulatory crackdown on high leverage among developers triggered a liquidity crisis.

A series of stimulus and easing measures from local policymakers have struggled to boost sales or increase liquidity.

Beijing city authorities marginally eased home purchase regulations last week, repealing a rule which restricted individuals from buying a home in the city within three years of divorce.

The number of cities with on-month price rises for new homes in March was 43, an increase of three from February.

Mega city Shanghai logged the highest price rise of 1.09%, whereas the northeastern city of Changchun experienced the steepest drop of 0.68%.

However, total sales by value among 100 real estate companies plunged 49.0% year-on-year in the first three months of the year, indicating a turnaround for the sector is not yet in sight.

“The intensive introduction of property market policies may lead to gradual repair of market sentiment,” China Index Academy said. “The decline in new home sales is likely to narrow in the second quarter.”

(Reporting by Liangping Gao and Ryan Woo; Editing by Christopher Cushing)