China’s housing prices fall at faster pace in June

Housing prices in China fell at a faster pace in June as sluggish conditions continued for a second month following a rally of nearly two consecutive years, a report released yesterday by China Index Academy showed.

The average price of new homes in 100 cities fell 0.5 percent from May to 10,923 yuan (US$1,762) per square meter last month, the academy said. The price fell by 0.32 percent in May — the first month-on-month drop since June 2012.

"The domestic housing market has entered a 'correction' period with most cities suffering high inventories while homeseekers remain rather reluctant to buy," the academy said. "We expect housing prices to keep going southward in the second half of this year though demand from buyers may possibly pick up at a slow rate too."

Prices in 71 cities nationwide decreased in June, compared with 62 in May. Of these, 35 cities posted drops of over 1 percent, an increase of five from a month earlier.

In the 10 largest cities, the average price of a new home shed 0.45 percent to 19,517 yuan per square meter in June, compared with a 0.18 percent drop in May. Shanghai, where home prices climbed 0.25 percent, was the only city of the 10 that saw a monthly rise. Hangzhou led the decliners with a 2.06 percent loss.

The number of cities where prices declined year on year climbed by six from May to 37, with Wenzhou leading with a decrease of 13.3 percent.