House price rises slowing in August: Official report

09:53, September 10, 2010      

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China's urban housing price, an irritant that pits the public against the government, rose at the slight pace in August, a newspaper affiliated with the National Bureau of Statistics reported.

The China Information News said Friday that property prices in 70 major Chinese cities rose 9.3 percent in August from a year earlier. The rise seems moderating after at least six months of double-digit growth. In July, the housing prices rose 10.3 percent year-on-year.

The newspaper said the August housing prices literally remained the same as July. Analysts believe that Beijing's credit-tightening measures have produced at least some results to curb the runaway Chinese property prices from exploding.

On Thursday, a top banking industry regulator warned of the risks building up in the financial sector. Liu Mingkang, Chairman of the China Banking Regulatory Commission, was quoted by the press that serious risks could cripple the banking system.

Liu urged China's lenders to strengthen "stress tests" to appraise how vulnerable they could be to a major crash of the property industry. "We must not ignore the hidden systemic risks and dangers," Liu said.

The Shanghai stock index dropped nearly 39 points, or 1.44 percent on Thursday with a relatively heavy volume of 156.2 billion yuan.

Banks and property developers led the decline. China's Vanke Co, the country's largest real estate developer, dropped 3.38 percent to 8.28 yuan, and Poly Real Estate Group Co., the second largest, dived 4.07 percent to 11.32 yuan. The China Merchants Bank, the sixth largest lender by asset, dropped 2.43 percent to 13.23 yuan, and Pin An Co, the second largest insurer, lost 2.55 percent to close at 28.49 yuan.

Also on Thursday, Xia Bing, a top government economist who sits at the central bank's policy advisory commission, told the press that Beijing is resolute in implementing its current policies of reining in property bubbles, curbing local government financing vehicles, and promoting energy conservation and eradicating waster and pollution, efforts analysts say will drag down China's economic growth later this year.

By People's Daily Online


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