China property slump persists in October with falling prices, sales as COVID bites

1 min read
Residential buildings are seen in Beijing

BEIJING (Reuters) – China’s property market continued its slump in October, with private data showing home prices and sales falling, suggesting lacklustre sentiment and a bleak outlook amid strict COVID curbs, which hit consumer confidence.

China’s property sector, once a pillar of growth, has slowed sharply in the past year as a result of a government clampdown on excessive borrowing by developers, and a COVID-19-induced economic slump.

Prices in 100 cities dropped for the fourth straight month in October, falling 0.01% month-on-month after a decline of 0.02% in September, according to a survey on Tuesday by China Index Academy (CIA), one of the country’s largest independent real estate research firms.

Breaking News:  Who are the Oath Keepers on trial for the Jan. 6 U.S. Capitol attack?

Property sales by floor area in 100 cities fell about 20% year-on-year in October, according to a separate statement by the academy.

Analyst Chen Wenjing at the research firm said property recovery depends on COVID containment measures and the strength of policies.

Any rebound in the real estate market is expected to be delayed if the country sticks with strict COVID restrictions to quell the repeated coronavirus outbreaks, Chen said. Such curbs are expected to stay in place for some time after the Communist Party Congress in October.

Despite more than 230 stimulus policies introduced by 160 local governments in September and October, including subsidies, easing of purchase restrictions and decreasing down payment requirements, the property slump has widened from small cities with a net outflow of population to major cities.

Breaking News:  Israel rescinds 200 Gaza work permits, citing bomb worries

Last month, new home prices in Shanghai and Shenzhen fell 0.05% and 0.32% in monthly terms, respectively.

Home sales by floor area in Shanghai and Guangzhou fell 35% and 26% in annual terms, respectively.

“Wait-and-see sentiment in homebuyers currently remains strong, with COVID flare-ups in many areas further dragging down the pace of market recovery and the previous policies have yet to take effect significantly,” Chen said.

(This story has been corrected to state that the Communist Party Congress was held in October, not this month)

(Reporting by Liangping Gao and Ryan Woo; Editing by Gerry Doyle)

tagreuters.com2022binary_LYNXMPEIA0106-BASEIMAGE

tagreuters.com2022binary_LYNXMPEIA0105-BASEIMAGE

Share your thoughts...