Global site navigation

Local editions

China new home prices see sharpest decline in over seven years
Business and Economy

China new home prices see sharpest decline in over seven years

by  AFP 2 min read
China's property market has come under intense pressure in recent years
China's property market has come under intense pressure in recent years. Photo: STR / AFP
Source: AFP

PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!

Prices of new homes in China saw their sharpest decline for seven years in October, data showed Wednesday, as the real estate sector was battered by a debt crisis and a slowing economy.

Property market has long served as a motor for growth in China, on the backs of rising standards of living and high demand in a country where home ownership is seen as a prerequisite for marriage.

But uncertainties linked to Covid-19, which have cooled demand and weighed on household income, are hitting buyers, at a time when several major real estate groups in China are in financial difficulty.

The price of new homes contracted 1.6 percent year-on-year, their sharpest decline since August 2015, analysis of figures from Beijing's National Bureau of Statistics (NBS) showed.

Read also

Three out of four bitcoin investors have lost money: study

Real estate prices fell in 58 cities, according to the NBS, which aggregates the average price in 70 cities across China.

Prices in the mega-cities of Beijing and Shanghai bucked the trend.

PAY ATTENTION: Follow us on Instagram - get the most important news directly in your favourite app!

The figures come after China's banking regulator unveiled sweeping measures to rescue the struggling property sector last week.

Those included credit support for debt-laden housing developers, financial support to ensure the completion and handover of projects to homeowners, and assistance for deferred-payment loans for buyers.

Friday's measures emphasised "guaranteeing the handover of buildings", and ordered development banks to provide "special loans" for the purpose, according to a copy of plans circulating online.

Property and construction account for around a quarter of China's gross domestic product, but crippling debts have forced a series of developers to default on loans while others have struggled to raise cash.

Analysts have raised fears that the crisis could yet spread to the country's financial sector at a time when Beijing's hardline zero-Covid policy has also put a lid on growth.

Source: AFP

Authors:
AFP avatar

AFP AFP text, photo, graphic, audio or video material shall not be published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP news material may not be stored in whole or in part in a computer or otherwise except for personal and non-commercial use. AFP will not be held liable for any delays, inaccuracies, errors or omissions in any AFP news material or in transmission or delivery of all or any part thereof or for any damages whatsoever. As a newswire service, AFP does not obtain releases from subjects, individuals, groups or entities contained in its photographs, videos, graphics or quoted in its texts. Further, no clearance is obtained from the owners of any trademarks or copyrighted materials whose marks and materials are included in AFP material. Therefore you will be solely responsible for obtaining any and all necessary releases from whatever individuals and/or entities necessary for any uses of AFP material.

Hot: