Residential property inventories drop in China: report

New residential property inventory dropped from the previous year for the first time in 54 months in August, according to data from a private property consultant firm.

Property inventory in 35 cities dropped 1.4 percent year on year and 0.8 percent from July, the sixth consecutive month-on-month decrease, an article in Tuesday's Economic Information Daily said, citing information from E-house China R&D Institute, a property consultant firm based in Shanghai.

The reason for the drop was likely sales outpacing supply, said E-House analyst Yan Yuejin said.

For big cities, inventory should be improved by increasing supply, otherwise housing prices may rise, Yan said.

Official data showed sales value of commercial housing in the first eight months went up 15.3 percent year on year. The growth rate was 1.9 percentage points higher than the first seven months, indicating nascent signs of recovery in some cities.

China's property market took a downturn in 2014 due to weak demand and a surplus of unsold homes. The cooling has continued into 2015, with both sale and prices falling and investment slowing.

With a string of supportive policies targeted at the property sector taking effect, China's metropolitan housing markets have seen strong rallies in recent months, while recovery in smaller cities remains mild. Endi