China new home prices fall faster in May

China's new home prices fell at a slightly faster pace in May, official data showed, as the crisis-hit property sector continued to grapple with fragile demand. New home prices dipped 0.2% in May from the previous month, steepening from a 0.1% decline in April, according to Reuters calculations based on National Bureau of Statistics data. On an annual basis, prices in May fell 3.5%, matching the decline in April. The price falls dampened hopes that the real estate sector, which accounted for around a quarter of the economy at its peak, is close to bottoming out after a nearly five-year slump. The slump has not only crippled some of China's biggest property firms but also turned a once key economic growth driver into a drag and weighed on overall household appetite for consumption. However, prices in the country's largest cities rose 0.2% in May after a 0.1% gain in April, with Shanghai, Shenzhen and Guangzhou posting increases. Prices in smaller tier-three cities extended their declines in May. Property sales, investment, new construction and funds raised by developers all fell more sharply in January-May, official data showed. Zhang Dawei, analyst at Centaline Property, said that the period of steep home price declines across China had passed and the market was not at risk of a rapid downturn. He added that the property market would continue to be characterised by "resilience in tier-one cities, divergence in tier-two cities and pressure in tier-three cities".