China's home price increase has lost steam in its biggest cities in January, tracking the government's continued efforts to curb risks of a price bubble and stabilize the sector.
New home prices climbed in 52 of 70 major cities, down compared with 57 in December, according to data from the country's National Bureau of Statistics, or NBS, data released Feb. 24. For January, prices fell month over month in 13 cities and were unchanged in five.
On a year-over-year basis, average new home prices declined in first-tier cities, while growth slowed in second- and third-tier cities, Liu Jianwei, a senior statistician at NBS, said in a same-day statement.
Liu further pointed out that among the 15 largest cities out of the country's 70 major cities, 11 have seen January new home prices weaken from the same period in 2017, with the decline sitting between 0.1 and 3.4 percentage points, indicating that the government's cooling measures are taking effect.
The biggest year-over-year fall of 3.4% was posted by southern Chinese hi-tech city Shenzhen. Among the other first-tier cities, prices dipped 1.2% in Beijing, fell 0.2% in Shanghai and climbed 3.7% in Guangzhou compared to the year-ago period.
"The data marks the first [general] price decline in first-tier cities after a 31-month consecutive rise," said Yan Yuejin, a research director at Shanghai-based E-house China R&D Institute, adding that the downward trend is likely to spread to lower-tier cities soon.
Since 2016, the Chinese government has rolled out a number of measures to clamp down on speculative activities from both homebuyers and property developers, showing no signs of relaxing the regulations anytime soon.
In the latest move, regulators further tightened developers' liquidity flows in order to reduce debt levels across the industry.
Amid the market slowing down, China Evergrande Group, the country's third-largest homebuilder, earlier in February announced that for the period running between Feb. 1 to Feb. 28, they would provide a 12% discount for the purchase of apartments it has developed.