China’s home prices posted their fastest growth in two years in April, with gains also seen in regional centres, indicating a broader recovery in the country’s housing market beyond the major cities.
Average new home prices in 70 cities climbed 6.2 percent in April from a year ago, up from March’s 4.9 percent rise, according to Reuters calculations based on data released by the National Statistics Bureau (NBS) on Wednesday.
That was the quickest year-on-year increase since April 2014, while 46 of 70 major cities tracked by the NBS saw annual price gains, increasing from 40 in March.
“(Price) growth in first and second-tier cities continued to accelerate, while third-tier cities reversed decline to post growth,” Liu Jianwei, a senior statistician at the NBS, said in a statement accompanying the data.
Top-tier cities Shenzhen and Shanghai were still the two top performers, with home prices rising 62.4 percent and 28 percent from a year ago, respectively. This was despite tightening housing measures introduced in both cities in late March. The paces compare to 61.6 percent and 25 percent in March.
Compared with March, however, price growth slowed. Shenzhen was up 2.3 percent compared with 3.7 percent, while Shanghai was up 3.1 percent from 3.6 percent.
Both cities tightened downpayment requirements for second homes and raised the eligibility bar for non-residents in late March.
China’s housing market bottomed out in the second half of the year on a series of government support measures, although most smaller cities haven’t been able to clear their oversupply issues, prompting many local authorities to push for even more stimulus.
Property observers in some lower-tier cities said prices have been recovering, helped by the slew of support measures.
“Prices have been on the rise since the start of this year after the loosening of mortgage rate and purchase restriction,” said Chen Ruisheng, a property development manager in the eastern coastal city of Wenzhou.
“Many developments are completing sales…government stimulus and subsidies must have some positive impact.”
The area of property sold in the January to April period grew at the fastest pace in three years, rising 36.5 percent, according to official data on Saturday.
Property investment in April grew 9.7 percent, maintaining March’s pace, as developers continued project starts in response to surging home sales, which are giving a much-needed boost to the slowing economy.