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New home prices up 0.1% month-on-month, first rise in a
year
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More cities reported new home price increases in Jan
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Market expects more stimulus measures to boost demand
(Adds analyst comments)
BEIJING, Feb 16 (Reuters) - China's new home prices rose
in January for the first time in a year, official data showed on
Thursday, as the end of the zero-COVID regime, favourable
property policies and market expectations for more stimulus
measures boosted demand.
New home prices in January were up 0.1% month-on-month,
versus a 0.2% slide in December, according to Reuters
calculations based on National Bureau of Statistics (NBS) data
released on Thursday.
More major cities among the 70 surveyed by NBS reported
increases in new home prices last month, with prices rising in
36 cities, up from 15 in December.
Analysts see rising home prices as a positive sign, but
believe more stimulative policies are needed to lift currently
dismal demand and spark a longer-term recovery.
The market expects Beijing will roll out more easing
measures to further revive the sector, especially during or
after a highly-anticipated annual parliament meeting starting in
early March.
"We believe that with the strong policy support from both
demand and financing side, the sales will start to rebound
significantly from late Q2. Any early boom will be positive for
the growth outlook," said Zhou Hao, chief economist at Guotai
Junan International.
The property sector, once an engine of the world's second-largest economy, has been hobbled by fragile demand and developers' mounting debt defaults.
Authorities have rolled out a flurry of aggressive stimulus measures to prop up the sector since late last year, including encouraging property financing and allowing eligible cities to cut or abolish the floor on mortgage rates for first-home buyers. Sentiment has been improving, buoyed by Beijing's COVID-19 policy U-turn in December and supportive measures, but the recovery has been patchy, with private surveys showing home sales by floor area slumping around 20% from a year earlier. Official sales figures will be released in mid-February. Prices were down 1.5% year-on-year in January, with the rate of decline unchanged from December. "The roots of the crisis in China's property sector lie in the worsening long-term outlook for demand," said Mark Williams, chief Asia economist at Capital Economics. "This has not improved. But sales started the year so beaten down that a short-run cyclical recovery is likely." (Reporting by Liangping Gao, Ella Cao and Ryan Woo; Editing by Jamie Freed)
