More cities see home price rebound in July

BEIJING -- More Chinese cities saw home prices rise in July from June as signs of warming have emerged in China's property market after some local governments relaxed their property curbs in the wake of weakening local economies.

In July, 50 cities, drastically up from 25 in June, out of a statistical pool of 70 major cities recorded higher new home prices than a month earlier, the National Bureau of Statistics?said on Saturday.

Compared with June, nine cities saw declines in new home prices last month, down from 21 in June, while prices in 11 cities remained unchanged, according to the NBS data.

However, on a year-on-year basis, new home prices continued on a downward trend, with 58 out of the 70 cities seeing price declines in July, up from 57 in June.

In July, new home prices in 11 cities rose by less than one percent year-on-year, while one city saw its new home prices remain the same compared with one year ago.

China has tightened its curbs on the property sector since 2010 in an effort to bring skyrocketing home prices back to a reasonable level. The government has restricted home purchases in several cities while requiring higher down payments and introducing property taxes.

The State Council, China's Cabinet, sent eight teams across the country to monitor local authorities' implementation of property curbs, and the result, released late Friday, showed that these measures have been "carried out well" and speculative housing demand has been curbed.

However, encouraged by rising transactions in recent months, some developers have started to hike prices or cancel discounts.

In some cities, prospective home buyers that chose to wait due to a tightening market started rush-buying following two interest rate cuts in June and July.

"It's still a little early to determine whether this momentum will be sustained," said Mark Budden, China Area Leader at EC Harris, a leading global built asset consultancy.

With a number of tightening measures still in place and property taxes increasing in certain cities, robust growth in home prices is unlikely in the short-term, Budden said.

Senior Chinese leaders have repeatedly pledged that the country will continue its property tightening measures despite a slowdown in national economic growth.

The country's economy expanded 7.6 percent year-on-year in the second quarter. The worst performance in more than three years came amid global economic instability and uncertainties, especially the eurozone debt turmoil.