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A visitor reads a handout of new properties at a real estate fair in Shenyang, Liaoning province.?[Photo/China Daily] |
BEIJING - China's property prices in October rose at the slowest pace in 10 months, after the government raised interest rates as part of Beijing's latest moves to cool the real estate market.
Housing prices in 70 of the country's large and medium-sized cities rose 0.2 percent in October from September, slower than the 0.5 percent increase in September, the National Bureau of Statistics said on Wednesday.
The year-on-year price rise in October was 8.6 percent, which was the sixth straight month of falling growth. Sales volume dropped 11.2 percent from the previous month, while the value fell 7.7 percent, according to the statistics bureau.
The slowdown in the growth of property prices showed how Beijing's latest round of tightening measures may be taking effect but the impact was limited in large cities where housing prices experienced little change, analysts said.
"The real estate market has responded to the government's tightening measures, which have dampened speculative demand nationally," said Chen Zhi, deputy secretary-general at the Beijing Real Estate Association.
"But the cooling measures may only have a limited effect as the real estate market in large cities such as Beijing showed little change," he said.
Chinese authorities are watching the risks from excess liquidity and asset price inflation carefully, after the US Federal Reserve Board introduced a second round of quantitative easing through its purchase of $600 billion of government bonds to stimulate the country's sluggish economy.
The Chinese central bank on Wednesday raised banks' reserve requirement ratio by 50 basis points, the fourth such hike this year. The move prompted speculations that more tightening measures will be rolled out in the fourth quarter.
Stocks of property developers fell on Wednesday, with China Vanke Co Ltd, the country's largest property developer, declining 3.68 percent to 9.15 yuan ($1.38).
Policymakers in Beijing adopted a new round of cooling measures for the country's property market in September. The moves included a nationwide suspension of lending for third and subsequent home purchases as well as higher down-payment requirements for first-time buyers.
Analysts said that the property price increase may continue to slow for the rest of the year as the government is likely to further tighten its grip on the property market, which is faced with growing asset bubble risks caused by potential speculative capital from abroad.
Property prices in some cities are still too high and challenges remain in cooling the overheated real-estate sector, Chinese media quoted Zhang Ping, head of the National Development and Reform Commission, as saying.
The government may introduce more property tightening measures in the fourth quarter amid signs of a price recovery, said Nomura Securities in a recent research note. The likely policies include a property tax and the enforcement of the so-called land added-value levy in the "overheated cities", according to the brokerage.
By Li Xiang and Bao Chang (China Daily)
