China land prices grew at a slower pace in 2Q

BEIJING: China's land market cooled in the second quarter, with prices falling in some major cities after an array of government measures to curb housing inflation, the China Securities Journal said on Monday, July 18, citing the Ministry of Land and Resources.

Average land cost for residential use rose 2.17% in the second quarter from the previous quarter, slowing from a rise of 2.44% in the January-March period, the newspaper cited data from the land ministry as saying.

Among the cities being monitored by the ministry, more than 60% of them reported slower price rises in residential land between April and June.

Some major cities, including Beijing and Hangzhou, saw residential land price falling during the period as government property tightening measures bite, the newspaper said.

The price of land used for residential housing in Beijing dropped 0.58% in the second quarter from the previous quarter, while the price in Hangzhou dropped 0.53%.

Some developers were channelling their investment from residential housing to commercial properties, the paper said.

"We need to pay high attention to whether the commercial properties will become a reservoir of real estate capital or a new bubble," it added.

The Chinese government unveiled fresh steps last week to rein in the red-hot property market by extending home purchase restrictions to more cities and urging localities to step up the implementation of existing measures.

Average new home prices in China in June rose 4.2% from a year earlier, accelerating from a rise of 4.1% in May. — Reuters