Chinese house prices sink for a seventh straight month in December
By Ambar Warrick
Investing.com -- Chinese house prices fell for a seventh straight month in December as the real estate sector continued to reel from disruptions caused by rising COVID-19 cases, slowing retail interest, and an extended liquidity squeeze.
House prices sank 1.5% in December from the prior year, data from the National Bureau of Statistics showed, compared with a 1.6% drop in the prior month. But the rate of declines improved slightly as the country scaled back most of its strict anti-COVID measures.
Still, given that China is now grappling with its worst yet COVID-19 outbreak, the real estate sector is likely to face continued headwinds in the near-term. China is facing a nearly three-year-long property crisis, which has battered the real estate market as some of the country’s largest developers faced a severe liquidity crunch.
Disruptions caused by the COVID-19 pandemic added to these woes, as lockdown measures under China’s zero-COVID policy disrupted construction activity and also weighed heavily on retail demand.
While the government has rolled out a slew of stimulus measures and loosened several lending laws to support the beleaguered sector, the effects of these actions are yet to be felt in the market.
Weakness in the real estate market also bodes poorly for China’s economy, given that the sector accounts for about a quarter of overall economic growth.
This saw the government recently relax restrictions on share sales and capital raises by local property developers, who were strapped for cash due to worsening market conditions over the past three years.
Focus this week is on China’s fourth quarter GDP data , to gauge how badly the economy was impacted by a spike in COVID-19 cases. Slowing economic growth was one of the key motivations behind China’s relaxing of anti-COVID measures in December.
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