China new home prices post first drop in two years

http://ift.tt/eA8V8J China's average home prices fell for the first time in two years in May and price weakness spread to more major cities, adding to signs of cooling in the property market which are posing a growing risk to the broader economy. The 0.2 percent monthly price drop in May, though slight, follows data last week that showed growth in property investment slowed while property sales and new construction tumbled, compounding the challenges for leaders in Beijing as they deal with an economic growth slowdown. The real estate sector, which accounts for more than 15 percent of China's economic output and directly impacts around 40 other business sectors, could determine the severity of that downturn. However, they said evidence of a sharp correction in home prices remains thin, putting to rest for now at least fears of a hard landing in the wider economy.



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