MNI 5 THINGS: China's Housing Market Heats Up in July

     BEIJING (MNI) - The 70-city housing price data released by China's National

Bureau of Statistics (NBS) on Wednesday showed further upticks in the country's

housing prices. MNI highlights five major points:

     - The average new home price of 70 major Chinese cities accelerated both on

a monthly and yearly basis. The data, excluding subsidised housing units, grew

1.2% month-on-month, up from the 1.1% gain in June, MNI calculations show. It

rose significantly to 6.6% year-over-year from the 5.8% growth recorded in June.

July's housing price still shows a strong upward momentum, demanding that major

cities continue to curb speculative investments and implement more effective

regulation policies. 

     - More cities saw housing prices increase m/m and y/y. 65 out of the 70

cities the NBS monitored saw m/m housing prices rising, more than 61 in June.

Compared with a year ago, 68 cities saw y/y price growth, up from the 61

reported in June. The data show a bullish sentiment in China's real estate

market. 

     - Housing prices in the 15 largest cities diverged: on a monthly basis, one

more city experienced price growth in July than in June, while the number of

cities experiencing housing price falls remained unchanged; on an annual basis,

three fewer cities saw price drops than in July 2017, while three more cities

saw price increases.

     - Home price growth slowed down in Tier-1 and Tier-2 cities m/m, but was

faster in Tier-3 cities m/m. Four Tier-1 cities' new home prices grew 0.2% m/m,

0.6 percentage points down from the previous month, showing the effects of

stricter regulation and better tailored policies. Of the four Tier-1 cities,

Shanghai's new home price declined 0.1% m/m. Tier-2 cities growth dropped 1.1%

m/m, 0.1 percentage points down from June. New home prices accelerated 0.8

percentage points to a 1.5% gain in Tier-3 cities. 

     - Sanya, a major tourist city, topped the list in housing price growth at

3.7% y/y in July. It was followed by 2.9% growth in Kunming, a city in

southwestern China; and 2.3% in Haikou, capital of Hainan Province. These cities

benefit from good natural environments, looser housing purchase policies and

shantytown renovation policies. New home prices in Dandong city, a city that

borders North Korea, had seen 3.3% growth m/m in June, and it cooled down to

0.5% growth m/m in July, after the local government implemented multiple

regulation policies in June and July. 

--MNI Beijing Bureau; +86 (10) 8532-5998; email: sherry.qin@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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