China’s Property Price Slide Continues as Number of Unsold Homes Hits New High
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House prices in China fell at a faster pace in August while the stock of unsold properties rose to a new high, underscoring weakening market sentiment despite a slew of supportive measures.
In August, new home prices in 70 major cities dropped 0.7% from July, falling for the 14th month in succession, according to data from the National Bureau of Statistics (NBS). Prices were down 5.3% from a year earlier, the fastest rate of decline since May 2015.
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- In August, new home prices in 70 major Chinese cities fell by 0.7% from July and 5.3% year-on-year, marking the fastest decline since May 2015.
- The inventory of unsold properties surged, with 738 million square meters unsold, and it could take up to 34.2 months to clear the stock in smaller cities.
- Despite various supportive measures, the real estate market downturn persists, with new property sales dropping 18% in the first eight months of the year.
- China and Hong Kong research
- Yang Fan, head of China and Hong Kong research at CLSA, highlighted that house prices in China have fallen significantly in recent years. Since the market peak in August 2021, prices have decreased by 17.9%, with some smaller cities experiencing more than a 40% drop. Despite several supportive measures, the market downturn shows little sign of recovery.
- CLSA
- CLSA is an investment group mentioned in the article. Yang Fan, the head of China and Hong Kong research at CLSA, highlighted that some smaller cities in China's real estate market have seen house prices fall by more than 40%. Additionally, he noted an overall housing price drop of 17.9% since the market peaked in August 2021.
- Shanghai E-house China Real Estate Research Institute
- Shanghai E-house China Real Estate Research Institute estimates it will take 26.6 months for 100 Chinese cities to sell all their housing inventories, compared to 13 months under normal conditions. For smaller cities, this period could extend to 34.2 months. In August, China had 738 million square meters of unsold properties, much higher than the average of 598 million square meters over the past decade.
- China Index Academy
- The China Index Academy is an organization mentioned in the article, with Xu Yuejin serving as its deputy director of research. Xu expects a slight market improvement in September and October due to the traditional busy season for sales but acknowledges ongoing market pressures. The Academy anticipates continued loose real estate policies and sees potential for further easing measures, such as lowering mortgage interest rates and reducing transaction taxes and fees.
- August 2021:
- China’s housing market peaked.
- First eight months of 2024:
- Sales of newly built properties dropped 18% from a year ago to 606 million square meters, with sales value plunging 23.6% year-on-year.
- August 2024:
- House prices in China fell at a faster pace while the stock of unsold properties rose to a new high.
- August 2024:
- New home prices in 70 major cities dropped 0.7% from July 2024, falling for the 14th month in succession.
- August 2024:
- Prices of new homes were down 5.3% from a year earlier, the fastest rate of decline since May 2015.
- August 2024:
- Prices of pre-owned homes fell by an average of 0.9% from the previous month.
- August 2024:
- Prices of pre-owned homes in the four largest first-tier cities fell 9.4% year-on-year.
- August 2024:
- House prices in second- and third-tier cities fell 8.6% and 8.5% year-on-year, respectively.
- August 2024:
- 67 cities recorded new home price drops and 69 reported lower prices for pre-owned homes.
- August 2024:
- Property sales dropped 12.6% year-on-year in terms of areas.
- August 2024:
- China had 738 million square meters of unsold properties, much higher than the average 598 million square meters over the past 10 years.
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