The Chinese government is capable of maintaining stability in the property market, a senior official said on Thursday, as measures have reined in surging prices in major cities.
"Despite looming problems and uncertainties, there are more favorable conditions. We are capable of maintaining stable and healthy development of the property market this year," Chen Zhenggao, minister of housing and urban-rural development, said during a press conference.
His remarks came amid stabilizing signs in China's property sector, which has seen fluctuations in recent years. Of 70 large and medium-sized cities surveyed, 45 saw prices for new residential housing climb month on month in January, down from 46 in December and 55 in November, according to the National Bureau of Statistics (NBS).
In Beijing, new residential home prices remained flat month on month, while Shanghai prices fell 0.1 percent. House prices in Shenzhen, a southern metropolis neighboring Hong Kong, slid 0.5 percent.
"The momentum of excessive home price increases has been contained, showing the primary results of regulatory policies," Chen said.
China's home sales boomed last year as progressive policy easing stimulated home buying in Beijing, Shanghai, Shenzhen and other first-tier cities.
Despite cooling a bit in the fourth quarter, sales of residential real estate in China jumped 36.1 percent to 9.9 trillion yuan (1.44 trillion U.S. dollars) last year, with prices soaring.
Home buyers could easily secure home mortgages and banks were generous in financing property developers. Aware of rising risks, dozens of Chinese cities have announced measures, including purchase limits and tightened mortgage restrictions, since October last year to prevent prices from rising out of control.
Central authorities have also moved to limit credit flowing into speculative buying and increase land supply for residential housing.
A long-term mechanism that aims to curtail property bubbles and prevent big market fluctuations was proposed in a tone-setting economic work conference in December 2016. With continued efforts to cool the market, home prices will likely continue to stabilize in the first quarter, Chen said.
While metropolises have already turned to bring down home sales, developers in many small cities are still grappling with unsold apartments. China will continue to push for urbanization as a major means to dissolve huge inventories of unsold homes in less developed areas, including favorable policies for rural residents to buy homes and settle down in cities, Chen said.
Shanty house owners will be encouraged to buy existing homes rather than build new properties, and the rental market will see more support from the government, according to Chen.
Although still at high levels, the country's unsold homes dropped 11 percent year on year to 403 million cubic meters at the end of 2016, NBS data showed.
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