Policy changes give boost to apartment purchases
Conditions in the property market improved in June with more major cities experiencing home price increases and others seeing slower declines, the National Bureau of Statistics (NBS) announced on Saturday.
The average new home price in the 70 cities monitored by the NBS increased 0.17 percent in June from a month earlier.
Among the 70 cities, prices rose in 27, up from 20 cities in May. Shenzhen in South China's Guangdong Province recorded the highest growth rates, with prices up 7.2 percent year-on-year and 15.9 percent month-on-month, the NBS statistics showed.
Prices for existing homes went up in 42 cities in June on a monthly basis, compared with 37 cities in May.
New home prices in 34 cities and existing home prices in 20 cities declined in June, nine and eight cities fewer, respectively, than in May.
Transaction volume increased in first-tier cities due to strong demand, and price increases in those cities outstripped gains in second- and third-tier cities, according to an online analysis the NBS released on Saturday, citing Liu Jianwei, a senior analyst at the NBS.
The first-tier cities are Beijing, Shanghai, Shenzhen and Guangzhou.
Home prices in second-tier cities stayed flat or rose slightly in June, while prices kept falling in third-tier cities but at a slower pace, Liu said.
Faced with a sagging property market, the country began announcing policies to encourage home purchases starting in late 2014, and these moves have boosted market demand, Zhang Hongwei, research director at Shanghai-based property consultancy ToSpur, told the Global Times on Sunday.
The central bank has cut the benchmark interest rate four times since November and banks' reserve requirement ratio three times since February.
Chinese authorities announced a down payment reduction for second-home buyers and a tax exemption for home transactions on March 30.
Many regional development plans released recently have also supported the market, such as the Beijing-Tianjin-Hebei coordinated development plan, according to Zhang.
The property market will keep recovering this year overall, although price trends will diverge among cities, Xia Dan, a senior researcher at the Bank of Communications, told the Global Times on Sunday.
The other first-tier cities are unlikely to see home price surges similar to those of Shenzhen in June, because Shenzhen has stronger demand than the other three cities, Xia said.
Only 30 percent of Shenzhen's residents have their own homes while the ratio in Beijing and Shanghai is 70 percent, according to Xia.