BEIJING (Reuters) -China’s new home prices in July rose at the slowest clip since January, official data showed on Monday, after authorities further tightened curbs on the sector, including limits on some categories of purchases, on top of existing stringent rules.
Average new home prices in China’s 70 major cities rose 0.3% in July from a month earlier, slowing from a 0.5% gain in June, according to Reuters calculations based on data released by the National Bureau of Statistics (NBS).
China’s property market rebounded quickly from the COVID-19 crisis last year, triggering concerns about financial risks in an overheated market.
This year authorities began stepping up curbs, including restricting borrowing by developers, capping banks’ lending to the sector, guiding banks to raise mortgage rates and prohibiting illegal flows of funds into the market.
Last month, a top decision-making body of the ruling Communist Party reiterated the government’s current stance on the property sector that “homes are for living in, not for speculation”.
The southern tech hub of Shenzhen said earlier this month that 2.155 billion yuan ($332.46 million) of loans meant for business use had been unlawfully used for home purchases.
Price growth in China’s biggest cities such as Shanghai and Beijing eased in July to 0.4% from June’s 0.7% growth, said Sheng Guoqing, an official with NBS, in a statement released alongside the data.
In Beijing, which has the most stringent property curbs in China, residents are not allowed to buy additional homes after owning two properties.
Prices in smaller tier-three cities rose 0.2% on-month, versus a 0.3% gain in June. Tier-two cities, which include some provincial capitals, gained 0.4%, slowing from June’s 0.5% rise.
In August, Jinhua, a small city in eastern Zhejiang province, and Huizhou, in southern Guangdong province, took action after the housing ministry told them a month earlier to strengthen their control over their respective markets.
The NBS data also showed 51 cities reported month-on-month gains, compared with 55 in June.
Compared with a year earlier, China’s new home prices grew 4.6% in July, down from a 4.7% increase in June.
($1 = 6.4819 Chinese yuan)
(Reporting by Liangping Gao and Ryan Woo; Editing by Sam Holmes)
