China new home prices up in December as stimulus kicks in
China’s new home prices increased in December for the fifth straight month, a survey showed Friday, following a series of stimulus measures aimed at boosting lending.
The gains come as authorities have vowed to stabilise China’s property market — a key pillar of the world’s second-largest economy. The average price of a new home in China’s 100 major cities rose 0.74 percent month-on-month in December to 10,980 yuan ($1,686) per square metre, the China Index Academy (CIA) said in a report, marking a pick-up from November’s 0.46 percent rise.
On a year-on-year basis, prices increased 4.15 percent. China’s property sector has come under pressure in the past two years as new buyers were priced out of the market while the economy falters. Home sales fell 7.8 percent in value in 2014.
The economy grew at its slowest pace for 24 years in 2014 and has eased further this year, raising concerns on global markets.
The country logged its worst economic performance since the global financial crisis in the third quarter, with growth of just 6.9 percent. In the 12 months the central bank cut interest rates six times and slashed the amount of cash bank’s must keep in reserve in a bid to ramp up lending to reinvigorate the economy.
And at a policy conference last month the government pledged to encourage property developers to “moderately cut housing prices” and ordered local authorities to “revoke obsolete restrictive measures”.
The CIA said it expected policies generated by the conference to “effectively adjust market supply and demand and further ease pressure on inventory”.