Home prices cool in May amid tough purchase, loan controls

Urban home prices have shown signs of cooling as prices faltered in major cities last month, after authorities implemented measures to contain the market, the National Bureau of Statistics ( NBS) said on Monday.

Of 70 large and mediumsized cities, 35 had a month- onmonth price decline or a slower price gain in May, up from 31 in April, the NBS said.

A total of 15 first- and secondtier cities surveyed had slower year- on- year price rises in May, and nine had month- on- month price declines or flat prices.

New residential house prices in Shenzhen, South China’s Guangdong Province, fell 0.6 percent month- on- month in May, while prices in Beijing and Shanghai remained flat.

“Prices of new homes in 15 major cities including Beijing, Shanghai and Shenzhen continued to stabilize in May on the back of targeted local gov- ernment policies,” said NBS statistician Liu Jianwei.

Property sales grew 22.5 percent in 2016 after two years of policy easing, starting with relaxation of purchase restrictions in 2014 and supported by interest rate cuts.

Surging housing prices, especially in major cities, have fueled concerns about asset bubbles. China’s policymakers announced in December that “houses are for living in, not for speculation.”

Since October, local governments have imposed measures including higher down payments, increased mortgage rates and tougher purchase restrictions, to curb price rises.

The property market, however, picked up again in February this year, and that led to a wave of tougher purchase and lending rules starting in midMarch.