Home prices show divergence among cities

The yearly reading was down from 1.3-percent growth for the first 11 months and 2-percent growth for the Jan.-Oct. period, the National Bureau of Statistics (NBS) said.

China’s gross domestic product rose 6.9 percent in 2015, official data showed Tuesday, as the world’s second-largest economy slumped to its lowest annual expansion rate in a quarter century.

But the headline number, published by the National Bureau of Statistics on Monday, masks China’s massive property problem – a vast amount of unsold apartments mainly in its smaller cities.

China’s crude steel output is expected to decline for a second straight year in 2016 on continued weakness in demand, according to a government study.

“Property investment is expected to see a single-digit decline this year despite recovering home prices, so it will continue to weigh on GDP”, said Liao Qun, China chief economist at Citic Bank International in Hong Kong. The central bank has reduced interest rates six times since November 2014, along with a cut on reserve requirements for all banks, helping to bring personal mortgage rates to the lowest in five years, according to Centaline Group.

China’s real estate sector warmed further in December, with more major cities reporting month-on-month rises in new home prices. For the whole year, prices first slipped then picked up later in the year.

Of the other major centres, prices in Shanghai – China’s finance capital – rose by 15.5% from 12-months earlier while those in the capital, Beijing, grew by 8.3% from December 2014.

Full-year industrial output rose 6.1 per cent year on year, while retail sales rose 10.7 per cent.