Data from the National Bureau of Statistics (NBS) showed that in January, new home prices fell by 1.5% per annum after a similar decline in December. Economists had expected prices to decline by 1.3% per annum. This was the ninth straight month of decrease in new home prices which remained at the steepest pace since August 2015.
Meanwhile, on a monthly basis, new home prices increased by 0.1%, recording the first increase in a year. In December, prices fell by 0.2%. The increase in prices was due to an increase in demand for housing against the backdrop of the lifting of coronavirus restrictions and measures to stimulate the real estate market. More major cities out of 70 reported rising new home prices last month, with prices rising in 36 cities, up from 15 in December.
Analysts believe that the government will take additional measures to support the real estate sector, especially during or after the long-awaited annual meeting of parliament, which will begin in early March. Last year, the real estate sector, once the main driver of the growth of the Chinese economy, suffered greatly due to unstable demand and growing debt defaults of developers. The latest data points to an improvement in sentiment in the real estate sector, but the recovery has been patchy: private surveys showing home sales by floor area slumping around 20% from a year earlier. Official sales figures will be released in mid-February.