China: Property price inflation falls in September – Nomura

Analysts at Nomura note that the simple average of property price inflation across 70 cities of China eased by 0.5 percentage points (pp) to 1.0% m-o-m in September.

Key Quotes

“The number of cities with sequentially higher prices declined to 64 in September from 67 in August, while the number of cities with lower or flat prices rose to six from three.”

“Property prices remained stable in Tier-1 cities, with inflation falling from 0.4% m-o-m to 0.0% in September.”

“Property price inflation slowed to 0.9% m-o-m and 1.1%, in Tier2 and Tier-3/4 cities, respectively, from 1.3% and 1.7% in August, partly dragged by a slower issuance of pledged supplementary lending (China’s version of QE) in Q3.”

“In addition to the slowing growth of property-related activities, the moderation of home price inflation in September further supports our view that the property sector is cooling. We expect the mild downtrend to continue.”