On average, the 70 cities prices increased by 0.61% in March, up from 0.53% in January. Average prices are currently up 11.30% year-on-year (YoY), and up 40.66% compared with December 2010 when the index was first established. 65 cities recorded an increase in prices, while 1 recorded no change and 4 recorded a decrease in prices.
First-tier cities recorded price growth decline to 0.2% month on month, compared to lower tier cities growing between 0.6% and 0.8%. Guangzhou continued to record strong growth albeit slightly down from last month, while Beijing saw an improvement with growth rates accelerating to 0.4% MoM. Despite prices maintaining a broad and healthy pace of growth, the government seems happy enough to remove some of the restrictions that have been put in place in a number of cities over the last two years. The government has also announced plans to remove (cities with a population of 1-3 million) or relax (cities with a population of 3-6 million) hukou restrictions in smaller cities. This, in addition to reports that banks are starting to reduce mortgage rates, should help to entrench the price growth that has been witnessed in recent months. First-tier cities, while not included in the cities that have seen policy relaxation, are also seeing more positive buyer sentiment as more properties are launched to the market and the prospect of a deepening trade dispute with the united states recedes.