China's housing market witnesses a slump for the 16th month

For the straight 16th month, the property market in China saw a slump in home prices, as widespread covid outbreaks “complicated” efforts to rescue the sector that has for months witnessed a steady fall.

As per a Bloomberg report, 70 cities across China saw a 0.25 per cent decline in the prices of new homes. As per National Bureau of Statistics figures, November also saw a similar slump. 2022 as a whole saw prices drop by 2.3 per cent. This figure excludes state-subsidised housing.

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For the pre-owned housing market, the slump was worse at 0.48 per cent in December. In November, the prices fell by 0.44 per cent.

The decline, as per the report, comes even as Beijing introduced a sweeping plan to rescue the housing industry and pledged financial aid for cash-strapped developers.

Additionally, the country has also taken steps to stimulate homebuyer demand. However, following the sudden scrapping of the nation’s stringent zero-Covid measures, the large-scale COVID-19 outbreaks, and high numbers of cases, have severely affected confidence among businesses and customers.

The Bloomberg report suggests that lowering borrowing costs for homebuyers may help boost demand, adding that “it’s unclear whether such steps are enough to revive a market that has seen sales drop since mid-2021. “ A recent China Index Holdings survey of prospective buyers in 100 major cities shows that prices will continue to fall in 2023.

(With inputs from agencies)

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