What’s new: China’s new-home prices in 100 cities continued to drop for a seventh consecutive month in January as demand remained sluggish despite a series of measures to shore up the real estate industry and the end of the country’s strict “zero-Covid” policy.
The average price of new homes in 100 major cities dropped 0.02% in January from December to 16,174 yuan ($2,400) per square meter, data from China Index Holdings showed.
New-home prices in first-tier cities such as Beijing and Shanghai climbed slightly from the previous month, while prices in second-tier cities such as Chengdu and Hangzhou continued to decline, the data showed.
New-home sales remain weak. The Lunar New Year, which fell in late January this year, is usually an important sales period for developers. But while data from China Index Holdings showed the average number of visits to new home projects increased in January, there were few actual transactions due to shoppers’ wait-and-see sentiment.
The background: China’s housing market started 2023 with a whimper as demand remained sluggish for an industry that has been hit hard by a debt and confidence crisis, industry data show.
The 100 largest Chinese developers by sales sold 354.3 billion yuan of new properties in January, down 32.5% from a year earlier and down 48.6% from the previous month, according to consultancy China Real Estate Information Corp.
Housing prices will continue to fall in 2023 as homebuyers remain in a tight wait-and-see mode, according to a recent China Index Holdings survey of prospective buyers in 100 major cities. Listings of existing residences have continued to climb, weighing on prices, the property institution estimated.
As the policy environment continues to ease, some core first- and second-tier cities may take the lead in market recovery and drive the national market to gradually stabilize, China Index Holdings said.
Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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