Latest official survey presented on Monday showed continuous stabilization of home prices in China’s biggest cities after a string of government measures to control price hikes.

Based on National Bureau of Statistics’ data, cost of new housing across 70 of the major cities in the country grew 10.4 percent in May year on year marking its sixth consecutive month of decline from its highest of 12.6 percent in November.

29 cities saw slower price increase year on year in May while 15 of the top-tier cities lost nearly 3 percent to a year on year increase of 16.2 percent. 

New home prices on a monthly basis raised by 56 out of 70 cities in May. Prices stayed the same in five cities while fell in nine. There were 58 cities that grew prices back in April.

Month-on-month prices in those cities increased by 0.1 percent in April to 0.05 percent last month.

In a year on year terms, price growth for the majority of the largest cities dawdled but it is still rising in the double digits except Shenzhen as it fell to its lowest in three months on new residential properties losing 0.6 percent from April.

Prices of new homes in Beijing where property hikes are the tightest remained unchanged from the prior month while current house costs edged down 0.9 percent the first lost since February 2015. Shanghai’s was flat as well.

On a year on year basis, average latest housing costs in China’s 70 biggest cities added 9.7 percent in May from last month close to April’s 9.9 percent and still standing as the fastest growth since October.

Compared to prior year, new home prices increased 10.4 percent in May pulling back from the 10.7 percent gain in April.

A number of mainland cities have increased their limits on property purchasing since late March securing loopholes in current restrictions.

As many as 20 cities have enforced rules that call for buyers of new residential houses to keep the homes for a minimum of two years before resale.

However, the low costs were only limited to first and second-tier cities which means prices in smaller cities remained high.

Bengbu rose 3.4 percent in a month its largest rally out of 70 cities tracked while southern Zhanjiang climbed 2.6 percent in May from April. Beihai located in Southern Guangxi gained 3.2 percent.

Out of the major cities, Guangzhou grew 0.9 percent for the same period.

Home sales volume slowed as well. Property sales pertaining to floor space edged up 8.3 percent year on year in May compared to a 14.3 percent year on year gain for the January to May period while increase in terms of value on a year on year basis grew 12.6 percent in May compared to 18.6 percent January to May. 

Economist Larry Hu said that it is evident that prices are increasing but at a slower rate although the headwinds will be stronger for the second half particularly next year.

It is for the reasons that there will be higher mortgage prices and front-loading of home prices which would curb demand for houses.

Smaller cities also restraint population inflows and have less residential second-home markets, making the current increase in prices there limited.

Mr. Hu said that once the people there have purchased a property, their next home buying may be done five years later.

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