China’s home prices rise

Beijing

China’s new home prices grew in January although major cities saw early signs of softening, as the government continued its efforts to rein in speculative demand to fend off bubble risk. The acceleration in prices across the nation suggests moves by provincial governments to support first-time buyers and upgraders by relaxing some purchase restrictions may be further fanning price gains in a market where fear of missing out is strong and mortgage fraud is rampant. Average new home prices in China’s 70 major cities rose 5 percent in January from a year earlier and 0.3 percent month on month, according to Reuters calculations based on the data from the statistics bureau on Saturday. The government removed the sales prices for affordable housing from the latest monthly calculations, distorting comparisons with previous months’ growth data. rices in December grew 5.3 percent on year and 0.4 percent on month, based on data which included affordable housing. The National Bureau of Statistics said in a statement that prices were “stable while slightly lower” last month, as eleven major cities fell year on year. “The housing prices in tier-one cities reversed from growth to a decline and there was a slowdown in the growth rate in tier two and three cities,” it said. China’s housing market has boomed since late 2015, giving a major boost to the economy, but is expected to gradually slow as measures to curb property speculation drag on sales. The challenge for policymakers is to counter the risks from a slowdown in the sector and curbs to excessive borrowing without endangering a growth target of around 6.5 percent this year.—Agencies

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