Chinese home prices predicted to rise modestly

The prices of Chinese homes are predicted to rise modestly this year due to government support measures for the sector. The action taken by the government has relieved some pressure on the faltering economy.

Home prices are predicted to increase by 2% in 2015 from 2014, and 3% in 2016.

Signs of stability in the property sector could ease fears of a more serious downturn in China's economy, which is heading towards its weakest rate of expansion in 25 years due to a combination of cooling demand at home and abroad.

However, improvements in home prices and sales are highly unlikely to turn into a full recovery for the sector, as large inventories of unsold homes weigh on the market and discourage new investment and construction, dampening the demand for cement.

Edited from source by Joseph Green. Source: Reuters

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