Urban home prices rise as demand returns
Home prices in China continued to rise at a moderate pace in April amid the release of pent-up demand due to the coronavirus outbreak, according to monthly data released on Monday by the National Bureau of Statistics.
In the four gateway cities, new home prices rose by 0.2 percent from a month ago, with Shanghai posting growth of 0.6 percent, Beijing recording a loss of 0.3 percent, while Guangzhou and Shenzhen both witnessing no change from March, according to the bureau, which monitors housing prices in 70 major Chinese cities.
In the pre-occupied housing market, prices in the four top-tier cities jumped 1.1 percent on average, accelerating from March's 0.5 percent gain. Beijing, Shanghai and Shenzhen recorded month-over-month gains of 1.1 percent, 1.2 percent and 1.7 percent, respectively, while Guangzhou remained flat.
In 31 second-tier cities and 35 third-tier cities, new home prices rose by an average of 0.5 percent and 0.6 percent, picking up from 0.3 percent and 0.2 percent growth in March. Prices of existing homes in second-tier cities advanced 0.4 percent and gained 0.2 percent in third-tier cities, also accelerating from March's 0.2 percent and 0.1 percent rises.
"The swift control of the spread of COVID-19, rapid business resumption and gradual normalization of life in general, combined with deferred purchases and increasing government monetary and physical support, seem to have led to improved home buyer confidence and an improvement in residential price growth rates," said James Macdonald, head and senior director of Savills China research.
"There still remain some hangover effects of COVID-19 on the economy and this may lead to some hesitation by some potential home buyers, but the vast majority seem to be encouraged by the overall trajectory of the market as witnessed in the recovery of sales volume and improving sentiment," he said.
Nationwide, new home prices in Nanjing, capital of eastern Jiangsu Province, and Tangshan, in northern Hebei Province, both rose 1.8 percent in April, the largest month-on-month increases, bureau data showed.
On a year-on-year basis, prices of new homes added 2.9 percent, 5.6 percent and 5.1 percent, respectively, in first-, second- and third-tier cities, easing from growth recorded a month earlier. In the pre-occupied market, they rose 3 percent, 2.2 percent and 2.4 percent in first-, second- and third-tier cities, compared with gains of 2.4 percent, 2.5 percent and 2.8 percent, respectively, in March.