Recent real estate data gives off mixed messages

Real estate transactions in 18 first- and second-tier cities tracked by China Confidential declined by an average of 3% during the week ending September 16. This is the second week of lower sales volumes. Meanwhile, data released by the National Bureau of Statistics (NBS) shows that home prices in August rose on a MoM basis, but by a smaller degree than in July. Some commentators believe that this has taken the edge off recent signs of recovery in the real estate market. We think that the situation is less clear cut than this. With YoY growth in house prices recording less of a fall in August and sales rising in smaller cities, the data also provides examples of continued strength in the market.