Reporting from Beijing — China's aggressive new regulations aimed at cooling off the nation's real estate market have led to the first decline in housing prices in 16 months, government data released Monday showed.
An index of urban residential property prices in 70 mid-size-to-large cities fell 0.1% in June compared with May, marking the first month-to-month drop since February 2009. Many buyers have been sidelined since the central government increased down-payment requirements and tightened mortgage lending in April.
The regulations were meant to crack down on speculators who have been blamed for inflating real estate values in many of China's leading cities. But with the economy showing signs of slowing, analysts said policymakers must be careful not to over-correct and stunt China's recovery. Real estate was one of the chief drivers of economic growth last year.
Meanwhile, housing starts continue to rise at a brisk pace. Investment in residential buildings in June was up 31.3% compared with the same month last year.