BEIJING, Mar. 21 -- A growing number of Chinese cities experienced a decline in property prices or a slowdown in growth during February.
That's as the government's tightening measures began to take effect, according to statistics from the National Bureau of Statistics (NBS) on Friday.
Property prices in eight cities among the 70 surveyed registered a month-on-month decline, compared with three in January. Meanwhile, 44 cities saw the growth rate narrowing on a monthly basis when compared with the January figure, according to the NBS.
New-home prices increased by 6.8 per cent in Beijing in February - unchanged from January - from a year earlier.
In Shanghai, prices rose 2.3 per cent year-on-year, up from 1.5 per cent in January, the NBS said.
However, as leading property developers enjoyed an outstanding performance last year, a large-scale price drop nationwide is unlikely in the short term, industry analysts said.
The net profit of Shenzhen-based Gemdale Corp, one of the nation's four largest property developers, climbed 52 percent year-on-year to 2.7 billion yuan (400 million U.S. dollars) as sales jumped by 34 percent to 28.3 billion yuan, the company said in a statement on Friday.
Sino-Ocean Land Holdings Ltd, a Hong Kong-listed property developer, reported a 54 percent increase in its net profit last year to 2.4 billion yuan. Its sales revue also grew 55 percent year-on-year to 13.7 billion yuan, according to the company's statement to the Hong Kong bourse on Friday.
"I believe July and August might be a watershed, with more property developers offering discounts to stimulate sales as their cash flow gradually tightens," said Carlby Xie, head of research and consulting for North China at Colliers International
To prepare for market volatility, an increasing number of property developers have started to expand into other sectors to diversify their risks.
Zhang Yuliang, chairman of the Shanghai-based Greenland Group, said the company plans to increase commercial properties to 40 percent of its overall business portfolio, from 35 percent last year.
The company plans to invest 8 billion yuan in building a landmark commercial property in Beijing with the South Korea-based Pohang Iron and Steel Co Ltd. The project, with a floor space of 337,000 square meters, will consist of a 280-meter-high landmark building, two 150-meter-high office buildings and a shopping mall.
Longfor Properties Co Ltd, a Hong Kong-listed property developer, will also increase its efforts in exploring resort properties this year. After opening a resort property project in Sichuan province last year, the company now aims to launch two projects in Yantai, Shandong province and Yuxi, Yunnan province, said the company's executive director Qin Lihong.
"Those projects will become a new source of revenue for the company in the future," Qin said.