BEIJING: Annual growth in real estate investment in China slowed further in November even though sales improved slightly, official data showed on Saturday, suggesting persistent weakness in the property market could undermine a fragile economic recovery.
Property investment, a crucial driver of the economy, grew 1.3 percent in the first 11 months of 2015 from a year earlier, slowing from an increase of 2.0 percent in January-October, data from the National Bureau of Statistics(NBS) showed. That was the lowest rate since early 2009.
New construction fell 14.7 percent during January to November period from a year earlier, worsening from a 13.9 percent annual drop in the first ten months, the NBS data showed.
The floor area of property sold grew 7.4 percent during the January-November period, up from growth of 7.2 percent in January to October, according to the NBS data.
"The modest improvement in the property sales was mainly contributed by good performance in big cities," Li Jiaoa senior NBS statistician said in a statement accompanying the data.
A cooling property market has weighed heavily on China's economy over the past year. Home sales and prices have increased in bigger cities over recent months, helped by a barrage of government measures.
Still, conditions remain weak in smaller cities and a huge overhang of unsold houses is discouraging new investment and construction.
Housing inventories reached 440.9 million square meters by the end of November, up 12.1 percent from a year ago, the NBS data showed.
While noting the risk posed by large inventories of unsold homes, China's President Xi Jinping said last month that China needed to reduce housing overhang to ensure sustainable development of its property market.
China's cabinet said last month that it would encourage rural residents to buy their own homes in small-and medium-sized cities, as part of efforts to bolster domestic consumption in its slowing economy.
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