The Chinese housing market has continued a slowdown that it started by the middle of 2019 during the coronavirus crisis. In April, the year-over-year increase in the country’s 70 major housing markets was only 5.1 percent for new houses, down from double digits from November 2018 to July 2019.
The Chinese state was in fact trying to limit fast growth in the country’s housing market and avoid the formation of a housing bubble. Yet, they might not have anticipated the effects of the coronavirus that hurt sales starting in January. While year-over-year price growth kept decreasing, month-on-month sales showed some signs of relief in April, rising by 0.42 percent compared to just 0.13 percent between March and February.
The negative development of house prices that some analysts predicted might therefore not take place in China, also because prospective buyers are believed to be postponing their plans rather than canceling them altogether. Since the Chinese central bank has eased some rules, allowing banks to lend more, this could also positively affect the property market going forward, according to Bloomberg.