BEIJING, March 18 China's home price inflation
slowed for the second straight month in February, the latest
sign of cooling in the country's frothy property market due to
government policy curbs and weaker domestic demand.
Average new home prices in China's 70 major cities rose 8.7
percent in February from a year earlier, easing from the
previous month's 9.6 percent rise, according to Reuters
calculations based on official data published on Tuesday.
In month-on-month terms, prices rose 0.3 percent in
February, slowing from January's rise of 0.4 percent.
China's red-hot property market has shown signs of losing
steam since late 2013 as local governments took further
tightening measures and banks gradually tightened lending to the
A mild cooling in the market could be welcomed by the
government, which has spent more than four years trying to tame
rising home prices on concerns of an asset bubble.
An abrupt property slowdown, however, could add to concerns
about bad debts and further weigh on the world's second-largest
economy, which slowed markedly in the first two months of the
State-owned China News Services reported on Monday that
developer Zhejiang Xingrun Real Estate Co, based in eastern
Zhejiang province, is on the brink of bankruptcy, owing 15
domestic banks 2.4 billion yuan ($388.5 million).
The National Bureau of Statistics said new home prices in
Beijing rose 12.2 percent in February from a year earlier,
compared with January's year-on-year increase of 14.7 percent.
Shanghai's home prices were up 15.7 percent in February from
a year ago, versus 17.5 percent annual growth in January.
Reuters started its weighted China home price index in
January 2011 when the NBS stopped providing nationwide data,
only giving home price changes in each of 70 major cities.
China's property market has seen a divergence between big
cities, where strong demand and short supply have pushed up
prices rapidly, and small ones, where rises have tended to be
slower on soft demand.
Home prices fell month-on-month in four of 70 major cities
in February, monitored by the NBS, down from five in January.
Premier Li Keqiang has promised to employ differentiated
property policies this year in different cities based on local
Official figures showed developers slowed their expansion
pace at the start of this year, with floor space newly started
for construction slumping 27.4 percent in January-February from
a year ago, adding to caution about the outlook.