Chinese cities record home price hikes

BEIJING - Agence France-Presse

People visit European-style houses in Huizhou city in southern China. AP photo

New home prices in more Chinese cities rose in July than in the previous month, the government said Saturday, amid cautious optimism the country’s property market may be bottoming out. Prices in 50 out of the 70 Chinese cities tracked by the government increased in July from June, the National Bureau of Statistics said in a statement. That represented a doubling from 25 in June.

China has been taking steps to tighten its housing market for more than two years. Measures have included prohibitions on buying second homes, raising minimum down-payments and imposing property taxes in certain areas.

The government, however, has also recently taken steps to boost the country’s slowing economy by cutting interest rates twice in quick succession and encouraging lending by reducing reserve requirements at banks. Cutting interest rates reduces the cost of taking out a mortgage and can stimulate buying.

Prices of new homes in another 11 cities were unchanged in July compared with 24 in June, statistics bureau said. Prices in a total of nine cities fell on a monthly basis, down from 21 in June. Government officials have attributed the slowdown of the world’s second-largest economy to the weakening of the property market as well as sluggish foreign demand.