Japan's Tankan shows improvement but Asian property may be topping out amid new curbs

Japan's economy moved out of recession in the fourth quarter but the data since then have been mixed (see, for example, Friday's reports).

The latest indication of a recovery came today. The Bank of Japan's Tankan survey showed that the index for large manufacturers rose to minus 8 in March from minus 12 in December. The index for large non-manufacturers improved 2 points to plus 6.

While Japan is trying to revive its economy, many other countries in East Asia are trying to cool their property markets.

Over the weekend, several Chinese cities introduced new curbs on home purchases. Bloomberg reports:

Beijing, the capital, banned single-person households from buying more than one residence while Shanghai prohibited banks from giving credit to third-home buyers, according to the local administration websites. The two cities will also enforce a 20 percent tax on capital gains from property sales...

The city administration of Shanghai, where new home prices in February rose 3.4 percent from a year earlier, also said it will increase down-payment requirements and interest rates for second-home mortgages. Shenzhen, Guangzhou, Chongqing, Tianjin and Jinan have also published details on the housing curbs.

Meanwhile, James Gruber notes that governments in Hong Kong and Singapore have become “more concerned with property price rises and are willing to act to curb them”. He thinks that it is possible that “property in Hong Kong and Singapore may be close to topping out not just for a few years, but for a decade or more”.