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China's new home prices saw a slight decline in November, marking the slowest drop in 17 months. The government's intensified stimulus measures aim to revive the struggling property sector, which has faced severe challenges since 2021. Data showed that new home prices fell by 0.1% month-on-month and 5.7% year-on-year. Efforts to stabilise the property market have included reducing mortgage rates, cutting down-payment ratios, and offering tax incentives. As a result, home prices rose in several cities, including Shanghai and Shenzhen, while Beijing saw a slight drop.
In a sign of gradual recovery, China's new home prices fell at their slowest pace in 17 months, as the government continued to push for economic stimulus to boost the ailing property sector. According to official data released earlier this week, home prices dropped 0.1% month-on-month in November, following a 0.5% decline in October. This marked the slowest rate of decline since June of the previous year, as calculated from the National Bureau of Statistics data. Advertisement
When compared to the same time last year, new home prices saw a year-on-year drop of 5.7%, a slight improvement from the 5.96% decline observed in October. In recent months, China's policymakers have ramped up their efforts to stabilise the property market, which has been in crisis since 2021. The sector's downturn was triggered by a government initiative to curb excessive borrowing by property developers, which left many firms struggling with cash flow.
To address the ongoing crisis, China's top leadership took a firm stance at a Politburo meeting on December 9, followed by the Central Economic Work Conference on December 11-12. The government has pledged to take further steps to stabilise the market and promote recovery.
As part of these efforts, 17 out of the 70 cities surveyed saw an increase in home prices month-on-month, an improvement from the previous month's 7 cities. The recent measures to stimulate the housing market included reducing mortgage rates, lowering the minimum down-payment ratios, and introducing tax incentives to make housing transactions more affordable. Among the largest cities, Beijing and Shanghai have also implemented tax breaks to encourage homebuying. In Shanghai, home prices rose by 0.6% month-on-month, while Shenzhen saw a 0.3% increase. However, Beijing experienced a small decline of 0.5%.
China's property sector, which has struggled for years, is showing signs of slow recovery as the government intensifies its stimulus efforts. The latest data reveals a modest decline in new home prices, but the recent policy measures, including tax cuts and lower mortgage rates, have had some positive effects. With more cities reporting price increases, China's leadership remains focused on stabilising the market and driving further recovery. While the path to full recovery may take time, these steps have helped prevent further declines in the market.
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