China’s home prices rise faster in March amid lending surge

BEIJING: New home prices in China grew slightly faster in March after growth slowed the previous month, putting a floor under the cooling market, as Beijing rolled out stimulus to boost the economy.

The sector’s solid growth could cushion the impact of a vigorous multi-year government crackdown on debt and escalating trade tensions with the US, although some analysts say bubble risks are rising as prices continue to climb.

Average new home prices in China’s 70 major cities rose 0.6 per cent in March, quickening from a 0.5 per cent gain in February, according to Reuters calculation of data released by the National Bureau of Statistics ( NBS) on Tuesday.

On the whole, it logged the 47th straight month of price increases. Most of the 70 cities surveyed by the NBS reported monthly price increases for new homes, and the number climbed sharply to 65 from 57 in February.

On an annual basis, home prices rose 10.6 per cent in March, the highest since April 2017, and also accelerating from a 10.4 per cent gain in February.

Consumer and business confidence have slipped in recent quarters in the face of slowing economic activity and the SinoUS trade dispute, as growth in the world’s second-biggest economy slumped to near three-decade lows last year. As banks loosen lending standards and lower mortgage rates, buyers are returning to the market in anticipation of bigger price gains.

“Under the loosening credit policy, buyers are now rushing into the market for fear of missing out as some cities have experienced large price declines in the previous months,” said Zhang Dawei, an analyst with Hong Kong- based Centaline, a property consultancy. — Reuters