Tuesday 13 July 2010

China's property prices fall

It looks like China's property market is cooling. From Bloomberg:

China’s property prices snapped 15 months of gains and bank lending eased in June, indicating that curbs on credit may diminish inflation pressures even as record exports support growth.

Real-estate prices in 70 cities fell 0.1 percent from the previous month, the statistics bureau said in Beijing today. New lending of 603 billion yuan ($89 billion) was the least in three months, the central bank said in a report yesterday...

Meantime, China’s foreign-exchange reserves had their smallest quarterly gain since 2001, climbing $7.2 billion to $2.454 trillion, the report showed.

The fall in property prices in June was small but could be a sign of more to come as there appears to be no let-up yet in the government's efforts to cool the market. Again from Bloomberg:

China will “strictly” enforce housing policies such as lending rules to prevent speculative real estate investment, the Ministry of Housing and Urban-Rural Development reiterated in a statement yesterday on its website.

The ministry will increase the supply of affordable homes and the redevelopment of shanty areas, the statement said.

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