BEIJING (Reuters) -China’s new home prices stalled for a second straight month in March, official data showed on Friday, as growing COVID-19 lockdowns dampened consumer confidence and weighed on demand.
Average new home prices in China’s 70 major cities remained unchanged month-on-month in March, the same as in February, according to Reuters calculations based on data released by the National Bureau of Statistics (NBS).
On a year-on-year basis, new home prices rose 1.5%, the slowest pace since November 2015, with the pace easing from a 2.0% rise in February.
Over 60 cities have eased curbs on home purchases to support the ailing property market this year, after Beijing’s campaign to reduce developers’ high debt levels pushed the sector into a deep chill in the second half of 2021.
But after some signs of improvement in January, a surge in cases of the highly transmissible Omicron variant and strict lockdowns have again cooled demand in many cities.
China’s State Council, or cabinet, said on Wednesday that more policy measures are needed to support the economy, but analysts are unsure if rate cuts would quickly reverse the slump as long as the government maintains its strict zero tolerance COVID-19 policy.
The commercial hub of Shanghai is in the midst of China’s worst outbreak since the virus emerged in Wuhan in late 2019, reporting more than 20,000 cases daily amid an unprecedented citywide lockdown. Dozens more cities are in partial or full lockdown.
In March, transactions by value of newly built homes in Shanghai slumped 27% from a month earlier to 36.2 billion yuan ($5.68 billion)，finiancial magazine Yicai said.
In the first 12 days of April, new home sales by volume in 30 cities surveyed by Wind were down 55.6% year-on-year, analysts at Nomura said in a note on Wednesday.
($1 = 6.3739 Chinese yuan renminbi)
(Reporting by Liangping Gao and Ryan Woo; Editing by Muralikumar Anantharaman and Christopher Cushing)