BEIJING (Reuters) - China’s property inflation moderated slightly in June on a monthly basis, private surveys showed on Monday, a rare show of results for Beijing’s near four-year-old effort to stabilise frothy house prices.
Home prices in China’s 288 major cities rose 0.4 percent in June from May, down slightly from May’s monthly increase of 0.9 percent, a poll by a real estate services company E-House China EJ.N showed. It was the second consecutive month of slowing property inflation.
But in a sign that China is far from successful in taming property inflation, house prices were up about 10 percent in June from a year earlier as strong demand coincided with a tight supply of homes - and land in top cities - as well as rising land prices.
Home prices in 288 major cities jumped 10.5 percent from a year ago, accelerating from May’s 9.7 percent annual gain, E-House said.
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 which could further strain the struggling Chinese economy.
A separate survey by China Real Estate Index System (CREIS) showed average prices in the 100 biggest cities rose for the 13th straight month in June on a monthly basis, albeit at a slower pace of 0.8 percent.
“Against the backdrop of rising uncertainties in the economy and strained liquidity conditions, home price gains continued to cool slightly due to increasing supply in several cities,” said CREIS, a consultant linked to China’s largest online property information firm Soufun Holdings (SFUN.N).
Average home prices in the 100 biggest cities rose 7.4 percent in June from a year ago, up from May’s 6.9 percent gain in the seventh straight month of rise.
In China’s most expensive cities Beijing and Shanghai, average home prices bucked the trend of monthly declines to rise 1 percent in June, and were up 10 percent on the year, CREIS said.
China’s 3-1/2-year-long campaign to temper home prices has been partly undone by the frenzied efforts of local Chinese governments to sell land for much-needed revenues.
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.
China is due to publish home price data in 70 major Chinese cities for June on July 18. Housing inflation slowed for a second straight month in May from the previous month, the most recent official data showed.
Reporting By Xiaoyi Shao and Koh Gui Qing; Editing by Kim Coghill