China's August housing prices grow slightly
Updated 14:27, 14-Sep-2020
Houses in Qingdao, east China's Shandong Province. /VCG

Houses in Qingdao, east China's Shandong Province. /VCG

China's housing market remained generally stable in August, with slight month-on-month growth in home prices in major cities, official data showed Monday. 

"The general rise in housing prices in August suggests economic recovery is accelerating, and it is partly due to the easing monetary policy in the first half of the year," Wang Dan, chief economist with Hang Seng Bank China, told CGTN. 

New home prices in four first-tier cities – Beijing, Shanghai, Guangzhou and Shenzhen – rose by 0.6 percent month on month in August, up 0.1 percentage point from a month earlier, according to data from the National Bureau of Statistics (NBS). 

Higher price inflation in Beijing (0.6 percent month-on-month in August), Shanghai (0.6 percent) and Guangzhou (0.9 percent) more than offset lower price inflation in Shenzhen (0.5 percent), according to Nomura. 

Thirty-one second-tier cities reported a month-on-month increase of 0.6 percent in new home prices, compared with a 0.5-percent rise in July, while 35 third-tier cities witnessed a month-on-month growth of one  percent in new home prices, with a slightly faster pace compared with the 0.8-percent expansion in July. 

"The slight increase in property price inflation suggests market conditions in the property markets remain decent. However, we believe over-heating risks are quite limited, given Beijing’s increasingly cautious stance on the property sector," Nomura said. 

Local housing authorities recently announced tightening measures, and the tightening of bond financing requirements for property developers was widely reported. There was no new issuance of pledged supplementary lending between March and August, Nomura added.  

Prices of resold housing in first-tier cities edged up one percent month on month in August, with the growth quickening by 0.3 percentage points than the previous month. Second-tier cities saw slower month-on-month growth of resold housing price, while the price rise in third-tier cities widened 0.1 percentage points from the previous month to 0.6 percent. 

In August, local governments continued to maintain the principle of "housing is for living in, not for speculation," and adopted timely and targeted measures to steadily implement the long-term mechanism for real estate supervision, said Kong Peng, a senior NBS statistician. 

China's investment in property development rose 3.4 percent year on year during the first seven months, compared with a 1.9-percent increase reported in the first half of the year, the NBS data showed. 

"We expect housing prices to rise steadily in the next six months. Although housing prices in first- and second-tier cities will still be strictly controlled, there is still room for monetary policy to relax in the coming months, which will indirectly push up mid-term housing prices," Wang said. 

As the country's regional integration speeds up, regional central cities such as Chengdu and Shenzhen will face the pressure of increasing housing prices, Wang cautioned. 

(With input from Xinhua)