| Actual | Previous | |
| Year over Year | -3.5% | -3.4% |
Highlights
China's residential property prices fell 3.5 percent on the year in April after dropping 3.4 percent in March, extending the prolonged downturn in the market. China's property market has been very weak for more than two years, representing a major drag on investment and consumer spending. Officials also adjusted their policy guidance today.
In their statement accompanying today's data, officials characterised the data as showing the economy has"maintained the steady and upward growth momentum". Although officials did not explicitly refer to the Iran conflict, they cautioned that the external environment is"complex and volatile" and again referred to an imbalance between strong supply and weak demand.
Officials today pledged to"implement a more proactive fiscal policy and an appropriately accommodative monetary policy", in contrast to the previous guidance which promised"more proactive and effective macro policies". This could indicate that changes to policy settings will be considered in the near-term, with the monthly review of the the loan prime rate later this week providing an opportunity for officials to make monetary policy somewhat more accommodative.
Definition
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.
Description
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.