Sep property investment growth slows to six-year low, figures from NBS indicate
Growth in China’s real estate investment over the first nine months of the year cooled to its slowest rate since the global financial crisis, although sales improved, underlining a mixed recovery in one of the most critical sectors of the economy.
Property investment, a main driver of the economy, grew 2.6 percent in the first nine months of 2015 from a year earlier, marking the slowest rate since the January-February period of 2009, data from the National Bureau of Statistics (NBS) showed on Monday.
“The fact that real estate investment is weak will hinder fourth-quarter economic recovery,” said Oliver Barron, a researcher at NSBO in Beijing.
While home sales and prices have improved in bigger Chinese cities over recent months after a barrage of government support measures, conditions remain weak in smaller cities and a huge overhang of unsold homes is discouraging new investment and construction.
New construction fell 12.6 percent during the January-September period from a year earlier though it slowed from a 16.8 percent annual drop in the first eight months, the NBS data showed.
Reflecting the sharp drop in housing starts, sales of earth excavating machines in China fell 35 percent in September from a year earlier, the China Construction Machinery Association said.
The property malaise has weighed on the Chinese economy, which is expected to post its slowest growth in 25 years this year.
Still, the recent rebound in home sales could suggest the housing market is at least bottoming out.
The floor area of property sold grew 7.5 percent during the January-September period, up from a 7.2 percent increase in January to August, according to the NBS data.
Regulators cut down payment requirements again late September for first-time home buyers as they look to reduce the property market’s drag on the broader economy.
China’s average new home prices rose 0.3 percent in August from July, the fourth straight month of gains, though they were still down 2.3 percent from a year earlier, according to official data out in September.