New home prices in China rose at the fastest pace in more than two and a half years in March from a month earlier, a private survey showed on Monday, thanks to a series of supportive measures to prop up the crisis-hit real estate sector to hold.
The average price of new homes in 100 cities rose 0.27% month-on-month in March, the biggest increase since July 2021, data from property researcher China Index Academy showed. That compares with a 0.14% month-over-month increase in February.
China’s real estate sector, a pillar of the economy, has gone from one crisis to another since 2021 after a regulatory crackdown on high leverage among developers caused a liquidity crisis.
A series of stimulus and relaxation measures from local policymakers have struggled to boost sales or increase liquidity.
Beijing’s city government last week slightly relaxed home purchasing rules by repealing a rule that banned private individuals from buying a home in the city within three years of a divorce.
The number of cities with monthly price increases for new homes in March was 43, an increase of three compared to February.
Megacity Shanghai recorded the highest price increase of 1.09%, while the northeastern city of Changchun saw the steepest decline of 0.68%.
However, total sales by value among 100 real estate companies fell 49.0% year-on-year in the first three months of the year, indicating that a turnaround for the sector is not yet in sight.
“The intensive implementation of real estate market policies can lead to a gradual recovery of market sentiment,” China Index Academy said. “The decline in new home sales is likely to ease in the second quarter.”
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