China July Home Sales Fall 17% as Property Curbs Take Toll

China’s home sales transaction value fell 17 percent in July from the previous month, as the country’s property curbs damped buying sentiment.

The value of homes sold dropped to 516.5 billion yuan ($84 billion) last month from 624.4 billion yuan in June, based on the difference between the National Statistics Bureau’s data for the first seven months and first half of the year. Housing sales from January to July were up 40 percent to 3.34 trillion yuan from the same period a year earlier, according to the data.

Home sales slowed after buyers rushed to the market earlier this year before the government stepped up a three-year campaign to cool home prices in March, with the capital city of Beijing among 35 provincial-level cities issued the toughest measures.

“July traditionally is a low season for property sales, while the effect of the liquidity squeeze in June is still having an impact on the market,” Dai Fang, a Shanghai-based property analyst at Zheshang Securities Co., said in a telephone interview today. “It takes longer for buyers to get mortgages, which has damped sentiment.”

Investment in homes, office buildings, malls and other real estate gained 21 percent to 4.43 trillion yuan in the first seven months, compared with a 15 percent increase for the same period a year earlier, the statistics bureau said in a statement on its website today. New construction rose 8.4 percent to 1.13 billion square meters (12 billion square feet).

An index tracking property shares on the Shanghai Composite Index fell 0.6 percent at the close of trading, the biggest loss among five industry groups on the benchmark, compared with a 0.4 percent advance by the index.

China may expand a property tax trial to as many as six cities including Hangzhou and Nanjing, China Securities Journal reported today, citing Yang Hongxu, deputy head of E-House China R&D Institute.

Home sales volume rose 27 percent in the first seven months from last year to 547.5 million square meters, the government data showed today. Property sales value including office buildings and retail space climbed 38 percent to 3.95 trillion yuan from a year ago.

— With assistance by Bonnie Cao

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