The slew of property cooling measures implemented by the Chinese authorities could finally be making some inroads as property prices rose in fewer cities in the last month.
Photo credit: CapitaLand China
Though the decline was slight, it is the second consecutive month that the number of cities with price increases have fallen. 56 out of 70 cities tracked by the National Bureau of Statistics showed increases in new-home prices in May, as compared to the 58 in April. Prices in 9 cities fell while that in 5 cities remained unchanged. In Shanghai for example, new-home prices stayed level while in Shenzhen, new-home prices fell 0.6 per cent. Overall sales of new homes did however rise 13 per cent in May in a year-on-year comparison, following a 8 per cent rise in April.
Photo credit: Keppel Land China
The real estate market has been a major part of China’s economic growth and with the property slowdown, the economic growth rate may have some froth taken off the top of the rather full coffee cup. With the governmental curbs and rising mortgage rates finally taking some effect, the property market in China may slow down in the second half of 2017. Demand in smaller cities may rise however as local authorities try to clear unsold stock.