BEIJING (AFP) – China’s home prices fell at a faster rate in September than the previous month, a survey showed Monday, as the central bank announced looser credit policies to try to avoid a sharp decline.
The average price of a new home in 100 major cities was 10,627 yuan ($1,731) per square metre last month, down 0.92 per cent from August, the China Index Academy (CIA) said in a statement.
It was the fifth month-on-month decline in a row, as analysts warn that China’s flagging property sector is contributing to slowing growth in the world’s second-largest economy.
All of China’s 10 biggest cities continued to post month-on-month decreases, with the average price in Beijing dropping 1.34 per cent to 32,281 yuan per square metre.
“The market trend is clearly downward” said CIA, the research unit of real estate website operator Soufun, adding: “Potential buyers expect the market to decline, and there is not enough credit to support demand.”
In recent years China has sought to rein in runaway property prices – a source of discontent among ordinary citizens – by introducing market control measures including buying limits on second and third homes.
But local governments make much of their income from land sales to developers and have tried to find ways to loosen the restrictions as property prices have fallen in recent months.
The survey results came as China’s central bank eased credit policies for the sector, announcing Tuesday that people who had paid off previous mortgage loans would be treated as first-time buyers and enjoy preferential policies.