China's new home prices accelerated at their fastest pace in almost two years in July, led by smaller cities and highlighting challenges policymakers face in stimulating a slowing economy without fueling a property bubble.
Average new home prices in China's 70 major cities rose 1.1 per cent in July from a month earlier, according to Reuters calculations based on an official survey on Wednesday, the fastest pace since October 2016 and up from the previous month's reading of 1 per cent.
Outside the recent boom periods of 2016 and early 2013, monthly price gains of more than 1 percent have been rare in China's official home price data.
The July increase marks the 39th straight month of gains, Reuters calculations showed.
China's property market has been heating up lately, despite tougher curbs designed to rein in a more-than-two-year real estate boom.
The market's surprising resilience also partly reflects the prevalence of buyers skirting existing restrictions on purchases.
The majority of the 70 cities surveyed by the National Bureau of Statistics still reported monthly price increases for new homes. 65 cities reported higher prices in July, up from 63 in June.
The resort city of Sanya, a tier-3 city in the island province of Hainan, was the top price performer in the month, rising 3.7 percent on-month, NBS data showed.
China said in late June that it would renew its crackdown on property irregularities in 30 major cities this year, prompting several local governments to announce new rules to prevent companies buying residential properties.
Compared with a year earlier, new home prices rose 5.8 percent, the fastest pace seen since September 2017 and quickening from June's 5 percent gain.
Despite Beijing's efforts to maintain property curbs, funding appears to be easing for property developers as Beijing pumps more credit into the economy amid a tit-for-tat trade war with the United States.
China's property investment growth sped up to its quickest pace in nearly two years in July, data showed on Tuesday, with year-on-year sales growth more than doubling from the previous month.
The 35 tier-3 cities in the survey led the price rally in the month while price growth in China's four largest cities of Beijing, Shanghai, Shenzhen and Guangzhou, and the 31 tier-2 cities -- which comprise sizeable provincial capitals -- was more subdued.
Tier-3 cities collectively posted a robust month-on-month price increase of 1.5 percent for new homes, the NBS said in a statement accompanying the data on Wednesday. That was more than double their 0.7 percent price gain in June.