Key facts
- China's new home prices fell 0.1% month-on-month in June.
- The monthly decline was slower than the 0.2% drop recorded in May.
- Year-on-year, new home prices decreased by 3.3% in June.
- This annual fall was an improvement from the 3.5% decrease seen in May.
- Cities have implemented measures such as relaxing homebuying restrictions and easing housing provident fund programs.
China's new home prices continued to contract in June, although the pace of decline slightly eased compared to the previous month. Official data revealed a 0.1% month-on-month decrease, an improvement from May's 0.2% fall. Annually, prices dropped 3.3%, also showing a marginal improvement from the 3.5% decrease in May.
Despite these slight improvements, nationwide demand remains weak, offsetting pockets of recovery in major cities. Analysts suggest that further supportive measures are needed to revive the struggling property sector, which has been a significant drag on China's economic growth. Measures implemented by cities include relaxing homebuying restrictions and easing rules for housing provident fund programs. The State Council has also pledged to conduct a nationwide survey of land and property projects to enhance policy effectiveness.
Resale home prices across all city tiers also saw declines both year-on-year and month-on-month. Property investment slumped 11.2% year-on-year in the first six months of the year, worsening from the previous month, while sales by floor area fell 3.5%. Analysts anticipate that policies will continue to focus on stimulating demand through measures like reduced mortgage rates and down-payment requirements.