* China Feb new home prices +2.1 pct on year, +1.1 pct on month
* New home prices rise in 66 of 70 cities vs 53 in Jan on month
BEIJING, March 18 (Reuters) - China’s new home prices rose in February from a year ago for a second consecutive month, though gains are expected to ease after the government unveiled this month tougher tax plans to curb real estate speculation.
Average new home prices across China climbed 2.1 percent last month, versus a year-on-year increase of 0.8 percent in January, according to Reuters’ calculations from data released by the National Bureau of Statistics on Monday.
China’s cabinet announced on March 1 that it planned to introduce a 20 percent capital gains tax and higher downpayments and mortgage rates for second-time home buyers in cities where prices are deemed to be rising too fast.
“This is not going to be sustained after the government’s new rules. Price rises will ease, but will not head south,” Jianguang Shen, chief China economist with Mizuho Securities Asia, told Reuters after the data.
He said China’s new government, which formally took office last week, must increase land supply for housing construction and expand the property tax on home owners to calm the market.
Local governments are expected to announce how they will implement those plans by the end of this month, Qi Ji, a vice-minister of housing and rural-urban development was quoted by domestic media as saying.
China’s fight against property speculation has headed into its third year but many middle-class Chinese are still priced out of the urban housing market.
Home prices rose month-on-month in 66 of 70 major cities monitored by the NBS in February, up from 53 in January, the NBS data showed.
New home prices in Beijing in February rose 5.9 percent from a year earlier, compared with January’s year-on-year increase of 3.3 percent. Shanghai’s prices were up 3.4 percent in February on a year ago, versus 1.3 annual growth in January.
China’s home price inflation may be steeper than official data suggests, with a near quadrupling of home sales in the capital last week just after the government unveiled tax plans to curb speculation, a sign that investors have giant gains to lock in.
Analysts say the strong transaction data reinforces an emerging view that the government believes demand is running hotter than official measures of headline price rises imply.
China’s home prices began their latest climb in mid-2012 as the People’s Bank of China, the central bank, began easing monetary policy to underpin faltering economic growth.
Reuters started its weighted China home price index in January 2011 when the NBS stopped providing nationwide data. The NBS now only publishes price changes for each of the 70 major cities.