* June home prices +0.8 pct on month vs +0.9 pct in May
* Prices rise 6.8 pct yr/yr in June vs +6.0 pct in May
* New home prices rise in 63 of 70 cities vs 65 in May m/m
BEIJING, July 18 The pace of China's month-on-month home price rise edged down slightly for a third straight month in June though the year-on-year gains were the strongest this year, underlining the challenges facing Beijing's near four-year-old campaign to tame housing inflation.
Average new home prices in 70 major Chinese cities climbed 0.8 percent in June from the previous month, easing slightly from May's month-on-month gain of 0.9 percent, according to Reuters calculations from data released by the National Bureau of Statistics (NBS) on Thursday.
Compared with a year ago, new home prices rose 6.8 percent in June, the sixth consecutive rise and the fastest pace since the Reuters calculation started in January 2011.
The relentless rise in home prices has sparked concerns since March that things could spiral out of hand, forcing Beijing to instruct local governments to tighten controls.
Still the implementation of these tightening measures has been patchy so far, as local governments are reluctant to cool the market and still intend to sell land to boost their revenue.
"The central government must ensure that the latest property controls are fully carried out in second-tier cities and beyond to achieve the national impact needed to stabilize the market," said Mark Budden, a senior consultant at EC Harris in Hong Kong, in an emailed comment.
"Faced with the dilemma of how to lower housing prices without exacerbating the economic slowdown, the Chinese government may assess second-quarter results before introducing tougher measures."
New home prices in Beijing rose 12.9 percent in June from a year earlier, compared with May's year-on-year increase of 11.8 percent. Shanghai's prices were up 11.9 percent in June from a year ago, versus 10.2 percent annual growth in May, the NBS data showed.
Home prices rose month-on-month in 63 of 70 cities monitored by the NBS in June, down from 65 in May.
Recent buoyancy in land markets in tier-1 cities - typically a prelude to home price increases - will reinforce market expectations that prices remain on an upward trend.
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.