China's property investment further slows

(Xinhua) Updated: 2014-10-21 13:55

BEIJING -- Investment growth in China's property sector continued to slow despite easing government restrictions on the market, statistics from the National Bureau of Statistics (NBS) showed Tuesday.

Real estate investment rose 12.5 percent year on year in the first nine months of 2014, 0.7 percentage point slower from the growth in the January-August period.

For residential property, investment rose 11.3 percent year on year, but the growth rate slowed by 1.1 percentage points from the first eight months.

Along with the slower investment growth, property sales saw a significant drop during the period.

Property sales went down by 8.9 percent year on year during the Jan.-Sept. period, with that of residential property slumping 10.8 percent, the data showed.

Since the beginning of 2014, the Chinese property market has suffered a notable downturn, with falling prices and sluggish sales. Official data showed that out of 70 major Chinese cities, new homes in 68 saw month-on-month price declines in August, compared with 64 in July.

To avoid a sharp slowdown in the property market, China on Sept. 30 unveiled eased mortgage measures for home buyers in a joint announcement by the People's Bank of China, the central bank, and the China Banking Regulatory Commission.

According to the announcement, mortgages on a second home will be treated as a first mortgage if the buyer has no other outstanding mortgages.

Before the easing of mortgage rules, 41 out of an original 46 cities removed home purchase restrictions amid a cooling market.

Tang Jianwei, an analyst with the Bank of Communications, said the change in property policies, as well as the easing market liquidity, will put an end to the property investment slowdown in the fourth quarter.

China is due to release home price data for September on Friday.