China’s real estate problems worsen as house prices fall in November survey
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BEIJING, Dec. 1 (Reuters) – Difficulties in the Chinese real estate market worsened in November, with new and resale home prices falling amid falling demand in major cities, a private sector survey revealed on Wednesday. .
The real estate sector, which accounts for a quarter of the country’s gross domestic product, has slowed sharply in recent months, with sentiment reeling from tight regulations and a growing liquidity crunch that has engulfed some of the country’s most indebted developers.
New home prices in 100 cities fell 0.04% in November from the previous month, from 0.09% growth in October, according to data from the China Index Academy, one of the largest independent companies. search for real estate in the country.
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This was the first drop in the survey since 2015, except for a 0.24% drop in February 2020, at the height of the COVID-19 pandemic in China.
Only 30% of 100 cities reported monthly price increases for new homes.
Prices in the resale home market fell 0.08% month-on-month, after falling 0.04% in October.
Official data for October had shown a drop in prices for that month for new homes, the first drop since March 2015, and lower resale prices in most cities, along with a drop in listings. site. Read more
âThe downward trend in the real estate market remains unchanged for the near future,â said academy research director Cao Jingjing.
The rapid deterioration of conditions in the real estate sector has sparked speculation that policymakers may begin to lift severe restrictions on buyers and developers and even cut interest rates.
But policymakers should generally stand firm for now, while making some financial adjustments to help genuine homebuyers. Read more
Some banks have accelerated the disbursement of approved mortgages and some have been ordered to extend more loans to real estate companies for project development.
Last week, the southwestern city of Chengdu took steps to ensure developers receive funds from pre-sold properties and new loans, as part of the first step taken by a Chinese city. to mitigate a liquidity crisis. Read more
Monthly new home prices in cities in levels one and two fell 0.1% and 0.02%, compared to gains of 0.01% and 0.09% in October, according to survey data of the Academy.
Property regulation policies should be fine-tuned, Academy’s Cao said.
Oxford Economics, in a recent note, expected the real estate slowdown to continue in the first half of 2022.
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Reporting by Liangping Gao and Gabriel Crossley; Editing by Kim Coghill
Our Standards: The Thomson Reuters Trust Principles.
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