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SHANGHAI : Property prices in China will fall over the next few months as government measures to cool the red-hot property market take effect, according to a top government official.
His comment is seen as the most forthcoming so far, from a senior official, on the direction of the country's high property prices.
China's Minister of Land and Resources, Xu Shao Shi, was speaking after a meeting with ministry officials in the north-eastern port city of Dalian.
He said home sales have declined and prices have stagnated, Xinhua news agency reported. He expects the property market to reach a full correction in about three months, but said it is hard to predict the extent of the price falls.
Now, all eyes will be on next week's property price data report for June.
In May, property prices in 70 of China's largest and medium-sized cities rose by more than 12 per cent from a year earlier. That was the 12th straight month on increase.
But prices were down by 0.2 per cent from the previous month. And analysts are expecting the month-on-month downward trend to continue.
China had earlier announced a slew of tightening measures to curb speculation and cool the red-hot property market. It is also looking at changes to property tax laws.
According to some market watchers, they expect the national average property price in China to fall by 10 to 20 per cent over the next 12 to 18 months.
In another rare revelation on Monday, an official from China's foreign-exchange regulator said that most of the speculative capital from overseas that has entered the mainland has ended up in the equity and property markets.
- CNA/al
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