China home prices down in worst performance in 2011

China's December home prices were down in their worst performance last year, with only two of the 70 cities tracked showing gains, even as the government reiterated it planned to maintain housing curbs.

Prices in 52 out of 70 cities monitored by the government were down from the earlier month, according to the National Statistics Bureau's statement on its website today. New home prices in the four major cities - Shanghai, Beijing, Shenzhen and Guangzhou retreated for the third month, it said.

The government said last month it would not back away from curbs on the real-estate industry while the financial centre of Shanghai and capital Beijing among other Chinese cities said they would continue to impose restrictions on home purchases this year.

China's economy recorded an 8.9 per cent growth in the fourth quarter from a year earlier, the slowest pace in 10 quarters as Europe's debt crisis crimped export demand and the property market softened, the statistics bureau said yesterday.

According to a property-tracking gauge, shares in Shanghai Composite Index were down 1.7 per cent today at the close, as against a 1.4 per cent decline on the benchmark measure.
Data showed that the eastern city of Wenzhou, where smaller businesses had to go through a tight credit squeeze posted the highest month-on-month drop of 1.9 per cent. The squeeze had prompted a visit as also a pledge of financial aid from premier Wen Jiabao in October.

Foreign direct investment also continued to fall for the second straight month in December.