Cross-posted from Investing in Chinese Stocks.
The monthly CREIS report is out. Home prices fell an average of 0.4% in October, down from the 0.92% drop in September. 73 cities saw price declines, 27 price increases. The number of cities seeing gains of more than 1% fell from 9 cities to 5. Cities with price declines of more than 2% went up one, from 11 to 12. The number of cities with 1% price declines was 37, down 5 from September.
The report supports the narrative of a housing rebound in the first-tier cities, mixed in second-tier cities and little change in third-tier cities. Cities such as Beijing have seen a strong rebound in activity: the latest news is that Beijing’s home sales increased more than 50% month on month in October and sales picked up throughout the month, such that late October sales figures were on par with figures from late October 2013. (Source: 北京楼市银十翘尾 中旬出现日成交量与去年旺季持平)
The number of second and third-tier cities being hit with large declines isn’t slowing, but there was easing of declines in the middle of the pack which helped lower the average decline. Overall, it was a lower volatility month that could be the start of a change in direction, but there’s no clear evidence of a broad trend yet.
