China Home Prices Grow Most in Seven Months in Fast Sales Season
China’s home prices grew at the fastest pace in seven months in March as a fear of missing out among buyers persisted in a traditionally fast season for sales.
New home prices in 70 cities, excluding state-subsidized housing, rose 0.41% last month from February, when then gained 0.36%, National Bureau of Statistics figures showed Friday. Values in the secondary market, which faces less government intervention, climbed 0.4%, the most in 22 months.
The price increases add to evidence that demand is outstripping supply even as developers push ahead with project sales to raise cash needed to bolster balance sheets under stricter new borrowing rules. Regulators are trying to control housing risks after monetary easing spurred a rebound in the residential market, with buyers using property to hedge against inflation.
In 28 key cities monitored by China Real Estate Information Corp., new-home sales surged more than 70% in March from a year earlier, twice as much as the 35% increase in supply, as builders seized on the first busy season of the year to push up transactions. Most cities faced a shortage of new-home projects during the month.
Chinese policy makers are now seeking to curb credit growth to prevent bubbles as the economy recovers from the pandemic, with the home market a particular focus of attention. Authorities in late March pledged to prevent business loans from trickling into the real estate sector.
New loans related to real estate, including mortgages, may decline in the coming months, Tang Jianwei, an analyst at Bank of Communications Co., said before the release. These measures are set to slow price momentum in coming months, especially in large cities, he added.
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