China continued to see a generally stable housing market in May amid a rapid rise in global property prices, with home prices in 70 major cities showing slight month-on-month increases, official data showed Thursday.

 

New home prices in four first-tier cities -- Beijing, Shanghai, Shenzhen and Guangzhou -- rose 0.7 percent month on month in May, compared with a 0.6-percent increase registered in April, according to data from the National Bureau of Statistics.

 

A total of 31 second-tier cities saw a month-on-month increase of 0.6 percent in new home prices, while 35 third-tier cities witnessed a month-on-month rise of 0.4 percent in new home prices last month.

 

The resale home market in first-tier cities saw prices increase 0.6 percent month on month in May, edging down 0.2 percentage points from April.

 

Prices of resale homes in second-tier cities saw a 0.4-percent month-on-month increase, while those in third-tier cities climbed 0.2 percent.

 

On a year-on-year basis, new home prices in first-tier cities rose 6 percent in May, up from 5.8-percent growth in April, while those in second-tier cities went up 5 percent, up from a 4.9-percent expansion in the previous month.

 

The resale home prices in first-tier cities grew 10.8 percent from a year earlier, narrowing 0.5 percentage points from the growth in April.

 

Globally, house prices are rising at their fastest rate since Q4 of 2006, according to an independent real estate consultancy Knight Frank. Its Global House Price Index, a means of benchmarking average prices across 56 countries and territories, increased 7.3 percent in the year to March 2021.

 

To deal with the shocks of the COVID-19 outbreak, some developed countries rolled out drastic stimulus policies with unprecedented liquidity easing, which leads to side effects including surging property prices, said Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, at the 13th Lujiazui Forum in Shanghai last week.

 

Unlike some developed countries, China avoided using a "deluge" of stimulus policies when strengthening macroeconomic policy adjustment, and the country has made sustained efforts to rein in housing speculation.

 

In this year's government work report, China reiterated the principle that "housing is for living in, not for speculation" for the third time since it was first proposed in 2016, vowing to keep the prices of land and housing as well as market expectations stable.

 

Local governments have taken timely regulatory measures. In February, Shenzhen announced transaction reference prices for resale homes in the city, which are generally lower than the market prices.

 

Beijing has vowed to intensify the crackdown on misappropriating loans for housing purchases. Guangzhou has successively introduced mortgage rate increases for residents' first and second houses, to curb speculative demand.

 

As these regulatory policies become more precise and effective, the rise in house prices is expected to slow down, said a real estate analyst Chen Xiao.