China New Home Prices Expected To Climb 3% This Year
Prices of new homes in China are now expected to climb 3% this year after a slew of policy measures to support the country's beleaguered property market, up from earlier expectations for prices to be flat, poll showed. But the poll of 11 economists, conducted Nov. 20-28, also showed expectations for 1% growth in new home prices in 2024 were little changed from an August poll. Economists said more measures from authorities are needed. Defaults on debt payments by many developers in China's cash-squeezed and highly indebted property sector have sparked fears of a broader financial crisis, weighed on consumer confidence and hindered economic growth. Authorities, particularly those in major cities, have embarked on a string of steps to bolster demand, including allowing smaller down payments, easing curbs on home buying such as the number of homes that can be bought, lowering borrowing costs and encouraging the extension of loans. But most analysts believe these actions must be complemented by stronger fiscal and monetary action. Estimates for home unit sales for 2023 were revised down to an 8% slide compared with predictions of a 5% drop in August, the poll also showed. Economists also expect declines next year, predicting a 5% fall. According to the poll, property investment is expected to slump 10% in 2023 and then 8.4% in 2024. Regulators are drafting a list of 50 property developers eligible for a range of financing support, including Country Garden (2007.HK) and state-backed China Vanke (000002.SZ).