China's new home prices remained flat in April for the second consecutive month, extending a prolonged period of stagnation despite renewed policy support and mounting pressure from trade tensions with the U.S. Data from the National Bureau of Statistics released Monday showed no change in prices from March, marking nearly two years without sustained monthly growth.
Compared to a year earlier, new-home prices fell 4.0% in April, a slight improvement from March's 4.5% drop, according to calculations by Reuters. Resale home prices posted broader declines, with values falling across tier-one, tier-two, and tier-three cities both monthly and annually. Prices of existing homes fell 0.41% month-on-month, steeper than March's 0.23% drop. From a year earlier, they dropped 6.76%, following a 7.25% decline in March.
"The property sector remains on a downward path. While many believe we're approaching the bottom, the exact distance remains uncertain," said Zhaopeng Xing, senior China strategist at ANZ. Analysts pointed to fading policy impact and weak buyer sentiment as core obstacles to recovery. "Policy interventions haven't fundamentally altered homebuyers' long-term market perspective," said Zhang Dawei, chief analyst at Centaline Property Agency. "Persistent economic uncertainty and income instability continue making potential buyers increasingly cautious."
The slump comes as Beijing faces external pressures tied to the U.S.-China trade dispute. While the two nations reached a temporary tariff truce last week, the economic fallout continues to weigh on domestic sectors including housing. "The tariff shock is caused by the unpredictability rather than the tariff itself," ANZ economists led by Raymond Yeung wrote in a recent note.
April also brought further evidence of real estate weakness beyond prices:
- Property investment dropped 10.3% year-on-year in the January-April period.
- Residential floor area sales declined 2.8% over the same stretch.
Officials have introduced a series of stimulus measures, including cutting the interest rate for housing provident fund loans by 25 basis points effective May 8. Authorities are also pushing ahead with programmes to renovate urban housing and allow local governments to acquire unsold inventory.
"The policy response clearly demonstrates the government's resolve to support real estate. Market participants now await stronger measures to restore confidence and avert further decline," said Zhang.
Edward Chan, credit analyst at S&P Global Ratings, noted that Beijing appears increasingly focused on reviving housing to stabilize broader consumer sentiment. "We believe the government has become more determined to reboot the property sector," Chan said. "This will be key to supporting consumer confidence, which Beijing has identified as its economic priority."
Reuters contributed to this report.
