Visitors look at house models during a real estate expo in Shanghai. Home prices dropped 0.28 percent month-on-month in November, following a decline of 0.23 percent in October. [Photo/ China Daily]

SouFun statistics show declines in all 10 of the mainland's largest cities

BEIJING - China's property prices fell for a third month in November, with more developers cutting prices to boost sales as continued government housing curbs squeezed their cash flow.

Home prices dropped 0.28 percent month-on-month in November, following a decline of 0.23 percent in October, statistics from the nation's biggest real estate website owner, SouFun Holdings Ltd, showed on Thursday.

Prices slid in 57 of the 100 cities tracked by the company, including all 10 biggest cities. Prices in Shanghai dropped 0.47 percent and those in Beijing dipped 0.08 percent. Ningbo, a coastal city in Zhejiang province, posted the biggest decline of 2.25 percent.

"If the tightening measures continue, a bigger decline in both property prices and transactions is expected next year," said Qin Xiaomei, chief researcher at Jones Lang LaSalle Inc (Beijing), an international real estate service provider.

China's central bank on Wednesday said it would cut reserve ratio requirements for commercial lenders for the first time since December 2008.

There is also a growing belief that some cities may suspend home-purchase curbs due to expire at year-end.

However, most analysts don't expect a loosening of real estate policies in the short term.

The government's property curbs "will continue as bank loans for the sector won't be loosened despite the reserve ratio cut announcement last night," said Li Ri, analyst with Century 21, a US-based real estate brokerage firm.

"The fine-tuning of monetary policy will target some specific sectors, and an all-round loosening up is not expected, especially for credit to developers," Li said.

Wang Tao, China economist with UBS Securities, took a similar view.

"We think it may be still too early for the property policy to be eased, as the government can still push up social housing construction to support overall construction and the economy at the current stage," said Wang.

According to Standard Chartered's latest real estate survey, which covered 30 residential real estate developers across eight second- and third-tier cities, all developers expect prices to fall further.

"Developers' finances are being squeeze ... more have difficulties paying for land. However, we did not detect any serious deterioration in developers' financing conditions yet," said Stephen Green, economist with Standard Chartered.

Fire sales are not widespread, and respondents seemed relatively confident that price falls of 20 percent would generate sales, the survey showed.