Data published by the National Bureau of Statistics of China (NBS) showed that in February, average prices for new housing in China's 70 largest cities fell by 1.4% per year after declining by 0.7% in January. It was the 8th straight month of drop and the steepest pace since January 2023, despite various support measures from the government. Prices declined at faster rates in Shenzhen (-4.8% vs -4.1% in January) and Guangzhou (-4.6% vs -3.6%) while moderating in Beijing (1.0% vs 1.3%). In Shanghai, prices increased by 4.2%, the same as in January.
On a monthly basis, the average primary market prices dropped by 0.36% and average secondary market prices fell by 0.62%. Both were similar to the declines in January. For new homes, 8 cities saw an increase, 3 cities saw prices unchanged, and 59 cities saw a decline. The biggest gain was a three-way tie at 0.4% between Shanghai, Tianjin, and Wuxi. The steepest decline was 1.1% in Nanjing. The secondary market was more downbeat. 2 cities saw an increase, and 68 cities saw a decline.
NBS said that from their respective peaks in 2021, primary market prices have dropped by 4.9% and secondary market prices have fallen by 10.1%. Both primary and secondary markets are seeing poor levels of liquidity. Experts predict that the real estate sector will remain the main drag on growth in 2024, and this obstacle is likely to persist in the medium term, as it will take time to cope with excess housing inventories.