The world’s second-largest economy has struggled to mount a strong post-COVID recovery as distress in the housing market, local government debt risks and weakening global demand slowed momentum.
While the Asian giant grew faster-than-expected in the third quarter, domestic demand has remained tepid and manufacturers have had to discount prices to find buyers.
A flurry of policy support measures has proven only modestly beneficial, raising pressure on authorities to roll out more stimulus as analysts say different parts of the economy are running at different speeds and long-standing issues persist.
“Transactions are typically depressed towards the end of the year, and the property sector in general does not want to take on more leverage and house prices are still too high compared to urban incomes,” said Dan Wang, chief economist at Bank China.
“People will just wait out this downward spiral,” she added.
China’s new home prices fell for the fifth straight month in November, data from the National Bureau of Statistics (NBS) showed on Friday, while property investment fell 9.4% January-November year-on-year, after a 9.3% drop in January-October.