New home prices in China rise in January
Average new home prices in China’s 100 cities rose in January, while declines in the secondary market narrowed following renewed government promises to stabilize the sector.
New home prices rose 0.18 percent on a monthly basis, following a 0.28 percent increase in December, according to China Index Academy, one of the country’s largest real estate research companies.
High-end upgraded housing projects were launched in January in cities including Chengdu, Shanghai and Hangzhou, and both monthly and annual prices increased in first- and second-tier cities, the research firm said on Sunday.
In contrast, third and fourth tier cities continued to operate on existing stock, with prices falling on both a monthly and yearly basis.
Prices on the resale market fell 0.85 percent over the previous month, narrowing from a 0.97 percent decline in December.
China’s real estate sector has been struggling since tighter regulations triggered a liquidity crisis for developers in 2021, many of whom have since defaulted on debt.
Developers are no longer required to report monthly data under the country’s “three red lines” policy, according to recent local media reports, signaling a clear end to the rules that triggered the ongoing debt crisis.
On January 1, Qiushi, the official newspaper of the Communist Party, stated that the real estate sector was “undergoing deep regulation” and called on policymakers to shorten the adaptation period, smooth market volatility and provide support all at once instead of piecemeal.
Sales will likely slow down in February due to the Spring Festival holiday, but demand should pick up in March as high-quality land in central cities comes to market and developers step up pre-holiday promotions, the research firm said.
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