China new home prices up in January

Beijing - China's new home prices increased in January for the sixth straight month, a survey showed Monday, positive news for the key sector following a series of stimulus measures aimed at boosting lending.

The gains come as authorities have sought to stabilise China's property market - a main driver of the world's second-largest economy - and rolled out new measures intended to encourage migrant workers to buy homes in the cities where they work.

The average price of a new home in China's 100 major cities rose 0.42 per cent month-on-month in January to 11,026 yuan (SS$2,385) per square metre, the China Index Academy (CIA) said in a report, a slight easing from December's 0.74 per cent rise.

On a year-on-year basis, prices rose 4.37 per cent.

The property market fuelled much of China's spectacular growth in recent decades but hit the doldrums in the past two years, with new buyers priced out despite government borrowing restrictions reining in soaring costs.

The economy grew at its slowest pace in a quarter of a century in 2015, expanding 6.9 per cent.

The National Bureau of Statistics said in January that total property market turnover jumped 16.6 per cent in 2015 as volumes rose, but added that growth in new construction slowed, limiting the positive effect on the overall economy.

Worries over a weakening currency and a shaky economy have caused capital to storm out of China, and raised questions among investors about the government's ability to stave off a "hard landing" this year.

At a policy conference in December the government pledged to encourage property developers to "moderately cut housing prices" and ordered local authorities to "revoke obsolete restrictive measures".

CIA, the research unit of real estate website operator Soufun, expected demand to rebound after the Lunar New Year holiday, with steady price growth, and more rapid expansion in some key cities.