Home prices in China rose for first time in over a year in October on an annual basis, signalling a housing market stabilization that could help re-energize the listless economy.
A swift rebound in property prices, however, is unlikely due to high inventories in all but the biggest cities, forcing developers to slow the pace of or even stop expansion to protect their cash flows.
Average new home prices rose 0.1% in October from a year earlier, Reuters calculated from National Statistics Bureau (NBS) data out on Wednesday, reversing September's 0.9% drop, marking the first year-on-year gains since August 2014.
Even a modest recovery in a sector that accounts for 15% of gross domestic product is a welcome boost for an economy heading for its weakest growth in 25 years.
The numbers boosted Chinese real estate stocks with the Shanghai stock exchange property sub-index surging more than 4% Greenland Holdings and Poly Real Estate gained nearly 10%.
The NBS data showed larger cities have led the price upturn, with Shenzhen the top performer. Prices in Shenzhen rose 39.9% in October from a year earlier, quickening from September's annual 37.6%
Following a year-long slump, China's home sales and prices have increased in bigger cities over recent months, helped by a barrage of government measures. Analysts expected to see more measures to revive the key sector in coming months.
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