(Yicai) Feb. 1 -- New home sales in China tumbled again last month, nearing the lowest point seen in recent years at some real estate developers.

The leading 100 builders sold CNY235.1 billion (USD33 billion) of new homes in January, down 34.2 percent from a year earlier and 47.9 percent from December, figures from consultants China Real Estate Information showed today.

The slump was due to a relatively high base of comparison a year ago when pent-up demand was suddenly released after Covid-19 restrictions were eased, while the property market is still relatively sluggish, said Liu Shui, corporate research director at the China Index Academy.

Sales at the top 10 developers fell below CNY10 billion (USD1.39 billion) each, tumbling by a third from a year ago to an average CNY7.2 billion. Sales sank below CNY1 billion at each of the top 50, following a 38.5 percent plunge to CNY960 million, while those across the top 100 fell to as little as CNY370 million.

The building industry is not optimistic about sales in 2024. A source at one of the top 20 told Yicai that his company has not bought any land in the past two years, and projects with good sales potential have almost sold out, so sales are set to decline further this year.

An insider at a real estate company in East China said the builder's remaining projects face a significant sales challenge. But it will try to seize the opportunity to sell units when people return to their hometowns over the Chinese New Year holiday this month, he said, adding that the outlook is not very upbeat.

To stoke a recovery in the property market, buying restrictions have been eased in the cities of Guangzhou, Suzhou, and Shanghai. 

The policy easing signal is clear, Liu said, adding that in the short term easing in Beijing and Shenzhen has become more likely and second-tier cities may fully lift restrictions. A more favorable policy environment may boost the market, he said.

According to CRIC, market confidence and industry expectations will take time to recover. Clear signs of a significant turnaround are unlikely in the near term. Meanwhile, developers must adopt proactive strategies to adapt to new changes, promote sales, liquidate inventory, and ensure liquidity security.

Editor: Martin Kadiev