New home prices in China fall at fastest pace in Il months

China’s new home prices fell at the fastest pace in Il months in September, worsening the property sector’s drag on broader economic growth as policymakers struggle to revive the flailing market.

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Persistent property market weakness is weighing on consumer confidence and sapping household spending, building the case for policymakers to step up support to shore up growth amid global trade threats.

New home prices fell 0.4 per cent month on month, following a 0.3 per cent fall in August, according to calculations by Reuters based on National Bureau of Statistics (NBS) data released on Oct 20.

Year on year, prices fell 2.2 per cent in September versus a 2.5 per cent drop in August.

"If the value of real estate, especially in first-tier cities, continues to shrink, people will feel they have less money to spend and will expect even less in the future," said Ms Hannah Liu, China economist at Nomura.

"We think it's possible to reintroduce measures to stabilise, or even slightly increase, housing prices in first-tier cities as this would be the most helpful... for boosting consumption," said Ms Liu.