The introduction of stricter restrictions on property acquisitions led to an easing of home price growth in China last month, reported Bloomberg.
In fact, 58 out of the 70 cities monitored by the government registered gains in new home prices last month, down from 62 in March, said the National Bureau of Statistics.
This comes after the Chinese government ramped up curbs in large cities in April to rein in property prices, following a resurgence in demand during the last two months.
Price growth in Beijing slowed to 0.2 percent after the local government raised the down payment requirements for second-time home buyers while clamping down on residential acquisitions under company names.
Prices in Shanghai also dropped 0.2 percent after the city stopped approving commercial property projects that are being redesigned for residential use.
“This round of property tightening has become stricter than the last one,” noted Guotai Junan International Holdings Co analyst Liu Feifan.
“More and more cities strictly capped selling prices, buying restrictions were intensified to the harshest ever, and new forms of tightening emerged, such as banning residents reselling apartments within” two or three years, added Liu.
Meanwhile, home sales also tapered off, with new home sales by value rising only by eight percent from the previous year or its smallest gain since March 2015.
Citigroup property analyst Oscar Choi believe that the momentum of the housing market is slackening under the government’s tighter purchasing rules and mortgage quotas.
“We expect national sales weakness to be more evident from May,” he said.
This article was edited by Denise Djong.
