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Growth in housing prices easing off

By Tu Lei (Xinhua)

08:50, October 19, 2011

Housing prices in 70 medium and large-sized cities saw nearly flat growth in September, according to figures released by the National Bureau of Statistics (NBS) Tuesday.

Insiders said that housing prices had hit a turning point amid weakening sales.

The NBS said that house prices rose last month in 24 of the cities it has been tracking, up from 23 cities that saw a rise in August. However, the biggest rise in the 24 cities was just 0.3 percent.

Meanwhile, 17 cities saw a slight dip in house prices month-on-month, compared to 16 in August.

"Housing prices are obviously easing," Sheng Laiyun, a spokesman for the NBS, said Tuesday in Beijing.

According to the NBS data, house prices in Beijing, Shanghai, Shenzhen and Guangzhou – four of the cities where property purchase restrictions have been imposed – have stayed largely unchanged for the last three months.

In Wenzhou, Zhejiang Province, house prices saw a decline of 6.4 percent year-on-year. But Chongqing Municipality, one of two cities to impose property taxes this year, saw the biggest drop in September, as house prices fell by 0.4 percent from August.

"The winter of the housing market has come," Yang Hongxu, a senior researcher with Shanghai-based E-house China, said Tuesday.

"Reading from the figures, we can see that housing prices have not changed month-on-month, but have declined year-on-year, which shows a turning point has been reached," Ji Feng, a researcher at property brokerage Centaline China Real Estate, told the Global Times Tuesday.

According to Ji, this shows that the government's real estate regulatory policy is having an effect.

"Now, the question is not whether there will be a decline in housing prices; it is about how great the decline will be," said Ji.

The data also showed that growth in housing investment slackened slightly in the last two months. Investment grew by 33.6 percent from January to July this year compared to the first seven months last year. But for the first eight months, the growth was 33.2 percent. And for the first nine months, it was 32 percent.

It has been reported that some small and medium-sized commercial banks will raise their interest rates on first-home mortgage loans by 5 to 10 percent, after the Beijing branch of China Construction Bank raised its minimum interest rate for first-time buyers Monday by 1.05 times the central bank's benchmark lending rate.

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