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Prices of new homes in China suffered their biggest fall in nearly a decade last month, in a sign that Beijing’s “historic” real estate rescue has not yet revived demand.

Prices in 70 major cities were down 0.7% in May from April, National Bureau of Statistics (NBS) figures showed on Monday. That’s the steepest month-on-month drop since October 2014, according to Reuters calculation.

According to separate calculations by the Macquarie Group, prices of existing homes in those cities fell by 7.5% year-on-year last month, marking the biggest decline on record.

A month ago, Beijing unveiled wide-ranging measures to rescue the crisis-hit property market, including asking local governments across the country to buy unsold homes from beleaguered developers and easing rules on purchases.

“To be fair, one month is too short for the housing rescue package to take effect,” said analysts from Societe Generale on Monday.

Measures, including efforts to provide cheap loans to state-owned enterprises for buying unsold homes from distressed developers, will “take time” to have an impact on the property market, the analysts said.

Still, other numbers on the real estate sector remain bleak.

Property investment for the first five months of the year dropped 10.1% from a year ago, according the NBS on Monday.

New property sales fell 28% during the same period.

Some parts of the Chinese economy reported a more optimistic picture, according to a separate set of top indicators released by the NBS on Monday.

Retail sales increased 3.7% in May, accelerating from a 2.3% rise in April and beating market forecasts.

Much of that boost came from a massive government trade-in programs for used cars and old home appliances, aimed at bolstering domestic consumption. The Labor Day “Golden Week” holiday, which ran from May 1 to May 5, also helped reignite some consumer spending.

Industrial output lost some momentum, growing 5.6% in May from a year ago, compared to April’s 6.7% increase. Fixed asset investment also missed expectations.

But China’s exports jumped 7.6% in May, marking the fastest pace since April 2023, according to customs data released earlier this month. Imports, however, fell short of estimates.

“The growth is highly uneven,” with exports as the driver and the property sector acting as a drag, said Macquarie analysts.

The threat of deflation continues to haunt the world’s second largest economy as domestic demand remains weak.

The consumer price index inched up just 0.3% in May, unchanged from April, according to the NBS last week. That was slightly below expectations.

Producer prices dropped 1.4%, down for a 20th consecutive month.

“While China’s growth remains uneven, we think more policy support is likely to come through to help keep growth on track for this year’s GDP growth target [of around 5%],” said analysts from HSBC on Monday.

“More attention will turn towards next month’s Third Plenum (of the Communist Party) which will highlight economic reforms for the coming years,” they said.

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