China Home Prices Decline Moderates in August Amid Market Support

China's housing market continued to show signs of weakness in August 2025, with new home prices falling 0.3% month-on-month, matching the decline seen in July, and average home prices in 70 major cities dropping 3.0% year-on-year, slightly less than July's 3.4% decline. Despite multiple stimulus efforts, including mortgage rate cuts and easing of homebuying restrictions in big cities like Shanghai and Shenzhen, demand remains subdued, particularly in smaller cities with high inventory and weak buyer sentiment. Resale home prices declined at an accelerated pace of 0.58% month-on-month, worsening from July's 0.55% drop, underscoring ongoing challenges in the property market. Year-on-year declines were widespread, with 65 of the 70 cities surveyed showing falling prices, and tier-one, tier-two, and tier-three cities experiencing significant drops in resale values. Property investment and sales also continued to decline, signaling the sector’s persistent drag on China's economic growth. Analysts cite weak income expectations and elevated unemployment pressures as key factors dampening market recovery despite policy support.