China home rut deepens as prices fall for first time since 2015
China’s home prices fell for the first time in six years as a property slump deepens in the world’s second-largest economy.
New-home prices in 70 cities, excluding state-subsidised housing, slid 0.08 per cent in September from August, the first drop since April 2015, National Bureau of Statistics figures showed Wednesday. Values in the secondary market declined 0.19 per cent, down for a second month.
A slump in the home market is becoming more evident as developers including China Evergrande Group struggle to raise money and buyers stay away. Falling prices may fuel a vicious cycle by further weakening demand, worsening the cash shortage at builders and forcing them to offer bigger discounts.
September is traditionally a peak season for the home market. Yet residential sales tumbled 17 per cent by area, investments slid for the first time since early 2020, and the rate of failed land auctions climbed to the highest since at least 2018.
The downturn has continued into this month. Existing-home sales plunged 63 per cent from a year earlier in the first 17 days of October, according to note from Nomura on Monday.
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