Beiging () - Average property prices in Chinese cities saw a second consecutive monthly drop in November, according to government data released Sunday, in a further sign that Beijing's two-year tightening campaign to cool the red-hot property market is having an impact.
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Data on 70 Chinese cities released by the National Bureau of Statistics and analyzed by The Wall Street Journal show average home prices declined by 0.17% in November compared with October, compared with a 0.13% decrease in October and a 0.01% increase in both September and August. Prices rose 2.3% on average in November from a year earlier, moderating from a 3% increase in October.
Prices of newly built homes in 49 of the 70 large and medium-sized Chinese cities that the bureau surveyed fell in November on a sequential basis, up from 34 cities in October.
The survey also showed that prices of newly built homes in five of the 70 cities rose month-to-month in November, lower than the 16 cities in October.
On a year-to-year basis, prices of newly built homes fell in four of the 70 cities in November, higher than the two cities in October.
Prices of newly built homes in major cities such as Beijing, Shanghai, Shenzhen and Guangzhou—often described as China's first-tier, or most developed, cities—were marginally lower compared with October, the statement said.
Analysts said that while the central government has shifted its priority to supporting economic growth from combating inflation, it remains set on controlling property prices. The People's Bank of China cut banks' reserve-requirement ratio by half a percentage point effective Dec. 5, helping ease liquidity in the country.
Efforts to tame property prices represent a delicate balancing act by the government. Housing costs are a volatile political issue and feed into broad worries over inflation in China's economy. But economists say roughly 25% of China's gross domestic product comes from housing and related industries. A sharper-than-expected downturn in property could complicate China's effort to insulate the economy from the European debt crisis and sluggish growth in the U.S., which have both reduced demand for China's exports.
Various levels of China's government have taken a number of steps to tame property prices, including limiting the number of second homes a person can buy. A handful of cities have taken more stern measures, including limiting the sale of property over a certain price in a few cases.