China’s property investment shrank for the third year in a row, despite Beijing’s efforts to reverse a downward spiral in the sector that has weighed on growth in the world’s second-largest economy.
Property investment dropped 10.6% in 2024 from a year earlier, widening the 9.6% fall seen in 2023, data from the National Bureau of Statistics showed Friday.
Investment in the property sector, which accounts for about one fifth of the Chinese economy, started to fall in 2022 as Beijing moved to rein in excessive borrowing.
For 2024 as a whole, construction starts dropped 23.0% from a year earlier, steeper than the 20.4% decline recorded in 2023.
Home sales by value tumbled 17.6% last year, widening from the 6.0% contraction marked in 2023.
The longer-than-expected property slump prompted Chinese leaders to take more aggressive measures to boost demand in the final quarter of 2024, including mortgage rate cuts, relaxed home purchase restrictions, allowing local governments to buy unsold homes and lowering down payment requirements.
The push seems to have started to have some effect on home prices toward the end of the year. Separate data released Friday by the statistics bureau showed that home prices in 70 major Chinese cities continued to narrow declines in December.
Average home prices in the 70 cities surveyed by the government dropped 0.08% month-on-month in December, narrowing from the 0.2% fall recorded in November, according to calculations by The Wall Street Journal based on data released Friday by the National Bureau of Statistics.
There were 43 cities reporting month-on-month home price declines in December, down from 49 in November.
On an annual basis, average home prices in these major cities dropped 5.7% in December, easing from November’s 6.1% decline. Of the 70 cities, 68 reported year-on-year price drops, up from 67 the previous month.
In a recent meeting to map out plans for the year ahead, China’s housing regulator said it would work to stabilize the housing market and prevent it from declining further in 2025. It noted that home transactions have posted month-on-month and year-on-year growth since October.
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(END) Dow Jones Newswires
January 16, 2025 22:04 ET (03:04 GMT)
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