SOURCE / ECONOMY
New home prices rising in Chinese tier-1 cities in May thanks to government’s pro-growth policies
Published: Jun 16, 2022 03:27 PM Updated: Jun 16, 2022 03:19 PM
Potential homebuyers look at a property model in Huai'an, Jiangsu province.Photo:Xinhua
Potential homebuyers look at a property model in Huai'an, Jiangsu province.Photo:Xinhua

China’s new home prices rose in May, as pro-growth policies from both the central and local governments including cutting mortgage rates to stabilize the real estate market kicked in, marking a gradual recovery of the property sector, official and experts said on Thursday.

In May, new home prices in first-tier cities rose 0.4 percent, expanding 0.2 percentage points from the previous month, while in second-tier cities, home prices fell 0.1 percent month-on-month, data revealed by the National Bureau of Statistics (NBS) showed on Thursday.

Sheng Guoqing, chief statistician from the urban department from the NBS, said that, in May, among 70 large and medium-sized Chinese cities, 43 cities recorded a price drop from April for new homes, four less than in April.

“The figure showed that the decline of the country’s new home prices has been curbed with the continued relaxation of housing purchase curbs, rolled out in many cities,” Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, told the Global Times on Thursday.

According to calculated results released by the institute, in May, the price index for China’s new homes in 70 major cities saw a 0.2-percent fall on a monthly basis.

Yan noted that the country’s new house prices are expected to come out of the woods and eke out a growth in the fourth quarter this year.

On Wednesday, the NBS released a series of economic indicators which revealed the country’s economy staged an impressive turnaround in May from a dip in April caused by pandemic lockdowns.

In the first five months this year, home sales totaled 4.83 trillion yuan ($719 billion), down 31.5 percent year-on-year.

Despite the January-May decline, the May data sent positive signals with government’s supportive measures, according to experts.

"For instance, the sales area of commercial properties in May showed a better-than-expected increase of 25.8 percent compared with the previous month, indicating a recovery of property transactions in May," Yan noted.

Fu Linghui, a spokesperson of the NBS, said that the real estate market has seen "positive changes" in May and could help stabilize the Chinese economy in the second half of 2022.

Global Times