BEIJING — The rise in China’s new-home prices eased in January, official data showed Monday, the latest sign that the government’s four-year campaign to rein in property risk may finally be starting to bite.
Prices in Beijing rose 14.7 percent in January from the same month last year, compared with a 16 percent increase in December. It was the third month of slowing gains after a record jump in October, according to the National Bureau of Statistics. Shanghai price gains also eased, to 17.5 percent in January from a year ago, versus 18.2 percent annual growth in December.
Still, home prices are at record highs and well beyond the reach of ordinary people, suggesting Beijing will not let up on its tightening campaign anytime soon. Analysts expect home price gains to moderate this year on relatively tight liquidity conditions and subdued demand, following strong demand in 2013.
House prices in China have surged in the past year, but the market began to show signs of losing momentum at the end of last year, as local governments took further tightening measures at the prompting of a central government worried about the risk of a bubble. A growing number of experts and developers have become less optimistic about the sector, with some starting to worry about downside risks.
“Because of the effects of a series of government measures, including tightening curbs in some cities and an increasing supply of affordable housing, the market environment and pricing expectations were relatively stable,” Liu Jianwei, a senior statistician at the National Bureau of Statistics, said in a statement accompanying the data. “Tightening credit conditions and easing pressures from housing inventories also helped home sales to drop, which in turn eased the home price rises further in some cities.”
The Lunar New Year holiday, when business activity in China slows, also caused home sales in most major Chinese cities to cool.
Adding to concerns about the market, the state-run Shanghai Securities Journal said Monday that one Chinese lender, Industrial Bank, had suspended some types of property-related loans, although several other banks had kept their policies unchanged. The report sent shares in the property developers China Vanke and China Resources Land tumbling more than 6 percent.
Industrial Bank did not respond to calls seeking comment. Other mortgage lenders, including Agricultural Bank of China, Bank of Communications and China Merchants Bank, did not respond to calls for comment.
Separately, the Chinese news media reported that some property developers in the eastern city of Hangzhou had started to cut home prices in recent weeks because they were in urgent need of cash. The National Bureau of Statistics data showed that Hangzhou’s home prices had dropped 0.1 percent in January from the previous month; prices in four other cities also fell.
China’s property market has undergone a divergence. In big cities, strong demand and short supplies have pushed prices up rapidly, while in small ones, the rises have tended to be slower and demand softer.
via:http://www.nytimes.com/2014/02/25/business/international/rise-in-chinas-home-prices-a-little-less-steep.html?partner=rssnyt&emc=rss
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