China’s housing rebound remains on track, even if there were hints of a slowing in China’s home price boomlet in May as the pace of price rises in some of the country’s biggest cities slowed.
But that was offset by sharp rises appearing in second and third tier cities, according the monthly data on house price movements released on Saturday by the country’s National Statistics Bureau.
Average new home prices in 70 major cities rose 6.9% in May from a year ago, accelerating from April’s 6.2%.
The NBS data showed 50 of the 70 major cities it tracks saw year-on-year price gains, up from 46 in April.
But month-on-month, prices were up just half a per cent in May, sharply down from April’s 2.3% rise from March.
But when taken with a small slowing in the pace of property investment in May confirms the Chinese economy is still muddling along, generating enough demand to keep Australian commodity exporters happy.
Economists said this was evidence that property price cooling measures introduced by some big cities recently are starting to bite.
“The average (price) growth of new homes in first-tier cities started to narrow, while it continued to widen in second- and third-tier,” said Liu Jianwei, a senior NBS statistician in confirming that point.
The southern city of Shenzhen remained the top performer, with prices surging 53.2% from May, 2015, down from the 62.4% rateseen in April. Shenzhen and Shanghai have tightened downpayment requirements for second homes and raised the eligibility bar for non-residents to purchase properties.
Shanghai prices rose 27.7 percent on-year, easing from 28 percent in April. The monthly gain cooled to 1.9 percent from 3.1 percent.
The sharp price rises are now spreading to more of China.
The coastal city of Xiamen surpassed the top-tier cities and saw the second highest price rise of 28%. Prices in second-tier cities Nanjing and Hefei also rose over 20%, more than the 19.5% in Beijing in May.
The faint signs of a slowing in prices came after annual investment growth in Chinese real estate slowed in May for the first time since December.
Figures out a week ago showed that China’s ousing sales rose 53.4% from a year earlier to 3.18 trillion yuan ($US482.5 billion) during the January-to-May period, according to data released by the National Bureau of Statistics on Monday. In the first four months of this year, housing sales jumped 61.4%.
In May alone, housing sales rose 32.9% on-year by value, slower than the 63.5% jump recorded in April. Investment growth in China’s real-estate rose 7% in the first five months of the year, down from the 7.2% gain recorded in the first four months.
Construction starts across residential and commercial real estate grew 18.3% in the first five months of the year, slower than the 21.4% rise recorded in the first four months of 2016.
