China's residential property prices fell 0.1 percent on the year in September, as they did in August, and fell 0.2 percent on the month after a previous decline of 0.3 percent. China's property market has been very weak for more than a year, representing a major drag on investment and consumer spending.

Investment data published earlier in the week also showed further weakness in property investment in September. Officials have eased property market restrictions in recent months, but both the house price and property investment data suggest conditions have yet to improve in response to these measures. This may strengthen the case for further measures to support demand and borrowing.

China’s House Price Index measures the average price of newly built homes in 70 Chinese cities. More detailed data is also provided for each of these cities, including separate data for different sized properties. Data for sales price, floor space and amount of money are sourced directly from the network transaction records data of local real estate management departments.

Home values affect much in the economy, especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can damp housing starts. Changes in home values play key roles in consumer spending and in consumer financial health. Rising prices increase consumers' ability to spend, based on wealth effects and from being able to draw upon expanding home equity lines of credit. Looking at the detailed data for each of the 70 cities also provides information on the strength of local property markets, with implications for regional growth rates.