Media365
Local government support has lifted sentiment in China’s struggling property sector ahead of the spring sales season, but analysts remain divided on the outlook as structural pressures persist.
New and existing home prices across 70 major mainland cities fell at a slower pace month on month in January, while annual declines widened, according to data released by the National Bureau of Statistics (NBS) on Friday.
New home prices in the four tier-one cities dropped 2.1 per cent year on year, 0.4 percentage points steeper than the previous month, the NBS said.
“The number of cities that experienced sequentially higher property prices continued to fall in primary markets in January,” said Chelsea Song, an analyst covering China’s economy at Goldman Sachs in Hong Kong.
“Despite recent targeted city-level housing easing measures, we believe the property markets in lower-tier cities still face strong headwinds from weaker growth fundamentals than top-tier cities, including more severe oversupply problems,” Song said.
Goldman Sachs said recent moves by cities, including Shanghai, to buy existing homes for public rental housing highlight efforts to support the property market.
