Home prices steady in October

▶ Stability comes amid tight regulations: expert

Home prices in major Chinese cities remained stable in October as local governments continued with tight property regulation, data showed on Thursday. The stable prices are in line with official goals to curb overheated prices and prevent risks, an expert said.

“This is what we want to achieve. Stopping further financial risk accumulation in the housing market is one of China’s major efforts in 2018,” Tian Yun, vice president of the Beijing Economic Operation Association, told the Global Times on Thursday.

“If house prices keep rising fast like in the past, greater financial risks will accumulate,” Tian said.

New commercial home prices in four first-tier cities – Beijing, Shanghai, Shenzhen and Guangzhou – remain flat compared with a month earlier, the National Bureau of Statistics (NBS) said in a statement on its website on Thursday.

New and existing home prices in 31 second-tier cities increased at a slower pace from the previous month, while prices of new homes in 35 third-tier cities saw a faster growth rate compared with September, the NBS data showed.

According to the People’s Bank of China data, the growth of individual housing loans has slowed down.

The individual housing loans balance at the end of the third quarter was 24.88 trillion yuan, up 17.9 percent year-on-year. The growth rate was 0.7 percentage points lower than the end of the previous quarter.

“The year-on-year growth rate of housing credit data has also fallen. It’s good because in 2016, the excessive rise in house prices had overdrawn the public consumption capacity.”

The expert noted that although the softened demand in the housing market will cause some problems in consumption in the short term, as long as the government takes measures to secure public housing needs, economic growth will not be encumbered.

“Most people buy on the way up, not on the way down, so in the short term some problems in consumption will prop up,” Tian said.

“But if the government can keep securing the public housing needs by providing enough land and encouraging social investment to build lowrent public housing, growth will not be encumbered at all.”

“This has been proved in southwest China’s Chongqing municipality. The public housing projects in the city have remained at a relatively stable price, and the economic growth of the city ranked first in the country, having been surpassed only recently.”