Property prices in China slowed down in August with the average selling price (ASP) in overall declined by 3.53% m-o-m to RMB 6,021 per sq m, while that of residential property also dropped 2.81% to RMB 5,712 per sq m. Home sales, on the other hand, saw a recovery on the back of strong sales in third-tier cities, posting a 2.28% m-o-m growth in August.
Buying sentiment in first-tier cities (Beijing and Shanghai) saw varying degrees of declines after an upsurge in the past few months, with total residential property sales declined 6.44% m-o-m. Among which, Beijing dropped 16.72% m-o-m, Shanghai dropped 16.07% m-o-m, while sales in Guangzhou and Shenzhen recorded 6.63% and 33.03% m-o-m increases respectively. In term of home prices, average selling prices in first tier cites rose slightly in August to RMB16,604 per sq m. Of which, home prices in Beijing witnessed a sharp growth, while that in Shanghai, Guangzhou and Shenzhen were down moderately during the period.
The property market has stabilised after a sharp slowdown in July. Monthly growth of average home prices finished August in the negative territory again, down 2.8 m-o-m, after a strong monthly rebound by over 8% in July, as most of the new projects were located in suburban areas and targeted end-users. Coming up to October, the market outlook will become clearer after the leadership change and we expect the sales to pick up in September in the face of the coming “Golden September”, but the upside potential should be limited as part of the end-users demand has already been met in the past few months