China Home Prices Rose in June at Fastest Pace in 21 Months

(Bloomberg) -- China’s home prices rose at the fastest pace in 21 months in June even as the government stepped up a campaign against property speculation.

New-home prices in 70 cities tracked by the government gained 1.1 percent from the previous month, according to Bloomberg calculations based on data from the National Bureau of Statistics released Tuesday. That compared with a 0.8 percent increase in May. It was the fourth straight monthly acceleration.

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So-called second-tier cities led the price gains, which are picking up even as officials extend more than two years of efforts to cool the housing market. In late June, the authorities announced a six-month campaign against property speculation in 30 cities, tightened approvals for loans for shanty-town redevelopments, and looked into further restricting developers’ sales of offshore debt.

“All these second-tier cities are growing phenomenally right now, we see huge population inflows which see huge demand for housing,” CLSA Ltd. analyst Nicole Wong told Bloomberg Radio.

Two cities in the tropical island of Hainan were among those to report big increases. Haikou posted a 3.9 percent gain from the previous month, the biggest of any of the 70 cities. In Sanya, the increase was 3.2 percent. In Beijing and Shanghai, prices were flat.

An index of 22 developers mostly listed in Hong Kong was down 1 percent as of 11 a.m.

Prices increased in 63 cities in June, compared with 61 in May. For the full year, home prices will gain, while sales will be slightly down from 2017, JPMorgan Chase & Co. property analyst Ryan Li said before the data release.

©2018 Bloomberg L.P.