China’s new home prices slump at fastest pace in 11 months amid dented buyer confidence

China’s new home prices fell at the fastest pace in 11 months in September across 70 major cities despite easing policies, as high inventories, concerns over job security and economic uncertainty continued to hurt confidence in the property market, analysts said.

New home prices fell 0.4 per cent month on month, following a 0.3 per cent decline in August, according to National Bureau of Statistics (NBS) data released on Monday. It was the biggest monthly decline since last October’s 0.5 per cent drop. On a year-on-year basis, prices fell 2.7 per cent in September versus a 3 per cent drop in August, according to the data.

New home prices in second-tier cities, meanwhile, fell 0.4 per cent in September, while those in third-tier cities contracted by 0.4 per cent.

“Despite recent targeted housing easing measures at the city level, we believe the property markets in lower-tier cities still face strong headwinds due to weaker growth fundamentals and more severe oversupply problems compared to top-tier cities,” Goldman Sachs said in a research note on Monday.