China's property market shows positive changes as supportive policies take hold

China's property market displayed positive changes in October, with narrowing price declines, stronger sales and improved market sentiment, as the latest wave of pro-housing policies took effect.

The decline in the prices of commercial residential homes in China's 70 large and medium-sized cities generally moderated on a month-on-month basis in October, said the National Bureau of Statistics (NBS) on Friday.

In the country's first-tier cities, namely Beijing, Shanghai, Guangzhou and Shenzhen, new home prices edged down by 0.2 percent, narrowing from a 0.5-percent drop in the previous month, according to the NBS.

Prices of second-hand homes in first-tier cities rose 0.4 percent in October, reversing a 1.2 percent decline in the previous month and marking the first increase in 13 months.

Second- and third-tier cities registered narrower drops in both new and second-hand home prices in October, the NBS added.

"Property market expectations further improved in October as home prices in Chinese cities either rose or declined at a slower pace month and month," said NBS statistician Wang Zhonghua.

Chinese authorities pledged in late September to reverse the property market downturn and stabilize the sector. The country has rolled out a slew of measures to prop up the market, including cutting mortgage rates, lowering down payment ratios and relaxing purchase restrictions.

Earlier this week, China unveiled incentives related to deed tax in property transactions to support people's housing needs. The minimum prepayment rate for land appreciation tax has been reduced to ease the financial difficulties of real estate companies.

"Property market activity surged in October. Inquiries and property viewings have increased noticeably, while the total area and value of commercial housing sales saw substantial improvement," said NBS spokesperson Fu Linghui at a press conference on Friday.

"The property market showed positive changes in October," Fu said. "As the effects of the policy package continue to unfold, the momentum driving the real estate market recovery is expected to strengthen. Therefore, we remain optimistic about the outlook of the property market."

However, Fu said that China's real estate market, after years of rapid expansion, had entered a new stage of development, transitioning from a focus on expansion to prioritizing quality improvements to better meet the diverse housing needs of residents.

Moving forward, China will coordinate efforts in land use, fiscal, tax and financial policies to accelerate the establishment of a new development model for the real estate sector, promoting steady and sound growth in the market, Fu said.

Recovery in the property sector is among the latest signs that the Chinese economy is gaining momentum as the country has intensified moves to shore up growth. Friday's data also showed faster growth in retail sales and the service sector in October.