China’s New Home Prices Fall Fastest in 7 Years in October

China’s new home prices plummeted at their fastest rate in over seven years in October, as a worsening slump driven by COVID-19 restrictions and a liquidity crisis pushed authorities to step up supporting policies in recent days.

According to data released by the National Bureau of Statistics on Wednesday, the average price of a brand-new house in 70 Chinese cities (excluding those with government assistance) declined by 0.37% from September to October. The existing-home market performed much worse, falling by 0.47%, the largest drop since 2014.

On an annual basis, new home prices dropped 1.6%, the fastest pace since August 2015, worsening from the 1.5% year-on-year fall in September and marking the sixth month of contraction.

The real estate collapse is hurting the world’s second-largest economy as cash-strapped developers cut investments and families hoard savings. Falling home prices aren’t boosting buyer confidence, which is key to reviving the industry and ending a year-long sales slump.