(Yicai) June 17 -- House prices in 70 major Chinese cities declined at a slower pace last month than in April, reflecting the success of policies aimed at stabilizing the property market.

New home prices in the first-tier cities of Beijing, Shanghai, Guangzhou, and Shenzhen fell 1.7 percent in May from a year ago, compared with a 2.1 percent drop the month before, according to data released yesterday by the National Bureau of Statistics. Prices in second- and third-tier cities fell 3.5 percent and 4.9 percent, respectively, versus 3.9 percent and 5.3 percent a month earlier.

While the real estate market is generally stable, buyer confidence is still in recovery and supply‑demand imbalances remain, NBS spokesperson Fu Linghui said, adding that ongoing efforts are needed to promote market stability and a full recovery.

The number of major cities reporting month-on-month increases in new home prices shrank to 13 in May from 22 in April, NBS data also showed. Hangzhou headed the list with a 0.8 percent gain, followed by Shanghai at 0.7 percent and Nanning and Urumqi at 0.4 percent.

Pre-owned home prices in first-tier cities dropped 2.7 percent from a year earlier, versus a 3.2 percent fall in April. In second- and third-tier cities, they sank 6.1 percent and 6.9 percent, slowing from declines of 6.5 percent and 7.4 percent.

Only three cities -- Luoyang, Nanchong, and Wuxi -- saw pre-owned home prices increase last month, down from five the month before, NBS data showed.

China needs to actively adapt to changes in the property market's supply and demand dynamics, continue promoting urban renewal projects and the renovation of old properties, ramp up the supply of high‑quality homes, stimulate demand for basic and upgraded housing, and forge new development models to ensure a healthy and stable real estate market, Fu noted.

Property prices are expected to continue recovering this month, Zhang Bo, director of think tank 58 Anjuke Research Institute, told Yicai. The future policy focus should be on managing short-term risks and exploring long-term development models, he added.

The marginal effects of policy stimulus have diminished since the beginning of the year, Securities Time reported Zhang Dawei, chief analyst at real estate agency Centaline Property, as saying.

April and May are traditionally the peak seasons for home sales, but prices generally fall in summer, Zhang noted, adding that they could fall more in the June-to-August period than in the past two months if robust policies are not introduced. He recommended more policy measures tailored to different regions and demographic groups.

Editor: Futura Costaglione