* March home prices +7.7 pct y/y, slowest gain in eight
* Average price gains expected to ease this year - analysts
* More developers to cut prices in some cities with
BEIJING, April 18 China's home price inflation
slowed to an eight-month low in March, extending to a third
month a loss of momentum in a property market that has been a
strong spot in the world's second-largest economy.
Average new home prices in China's 70 major cities rose 7.7
percent in March from a year earlier, easing from the previous
month's 8.7 percent rise, according to Reuters calculations
based on data released by the National Bureau of Statistics
(NBS) on Friday.
In month-on-month terms, prices rose 0.2 percent in March,
slowing from February's rise of 0.3 percent.
Analysts said the cooling of the property market is an
initial indication of stabilisation and they expected the easing
trend to continue this year.
"Home price rises will continue to lose momentum this year
as we have seen more developers start to cut prices," said Liu
Yuan, a research head of property consultancy Centaline in
"However, we think the market will finally stabilise thanks
to still strong demand and local governments' possible moves to
ease restrictions on home buying," Liu said.
China's property market has lost steam since late 2013 as
authorities tightened controls on speculative buying, and as
banks made it harder for home buyers and small developers to get
There have been other indications of weakness in the sector,
such as falling investment and slowing gains in land prices,
raising some concern that the sector is becoming a risk to the
government's engineered slowdown of the economy.
The government has spent more than four years trying to tame
record home prices on concerns that they were stoking an asset
bubble, and some see the efforts bearing fruit.
"The current property market is just cooling down mildly
from the red-hot situation seen in past years, which is actually
quite good for the healthy development of the industry," said
Chen Guoqiang, vice chairman of China Real Estate Society, a
property policy research body.
But too sharp a fall in a sector that supports some 40 other
industries, ranging from cement to furniture, may set off alarm
bells about potential bad debt and drag further on the economy,
which marked its slowest growth pace in 18 months in the first
The NBS data showed home prices increased year-on-year in 69
of the 70 cities monitored, unchanged from February. Wenzhou, a
centre for private businesses, was the only city where house
prices fell in March, dropping 3.9 percent from a year ago.
On a month-on-month basis, four cities, including Wenzhou
and Haikou in the far south, saw home prices drop, while 10
cities, including Hangzhou and Ningbo, saw prices unchanged from
the previous month, the NBS said.
Price gains also eased in the country's wealthiest cities,
including Beijing, Shanghai, Guangzhou and Shenzhen, but the
four still saw double-digit year-on-year growth.
Official data on Wednesday showed marked decelerations in
property investment and sales and a contraction in housing
starts in the first quarter.
(Reporting By Xiaoyi Shao and Jonathan Standing; Editing by