The government will release two indexes of new and second hand home sales starting with figures from January stop publishing its national property price index which looks at average home prices in 70 major cities.
The first data under the new system will be released tomorrow (Friday) and from then on the index will be published on the 18th of each month.
The statistics agency said its new housing sales methodology would help consumers and policy makers better understand price changes in their cities as it should better reflect regional differences and would rely on more complete residential data from local authorities and real estate agents instead of survey samples.
The national property price index had been criticised for understating the severity of the country’s property bubble by diluting the large rises in big cities with tamer changes in smaller ones.
New homes will be broken down into low cost housing and private sector homes. Private sector homes will come under three categories: places smaller than 90 square meters, those from 90 square meters to 144 square meters and those larger than 144 square meters.
The index showed property prices rose 6.4% year on year in December despite Beijing's measures to clamp down on speculation and rein in prices, including higher down payment requirements and banning second and third home purchases in some cities. Independent estimates generally showed even greater increases in property prices.
The Bureau said it will continue to monitor 70 big and medium sized cities and use online registration data for home transactions for 35 of them. For cities that don’t have online registration systems, the bureau will continue to use figures from local authorities.
‘Online registration data covers a wider range, is more detailed and easy to access. We will stop reporting the median home prices because they are not representative and can cause misunderstandings,’ it said in a statement.
But not everyone is convinced. ‘It's like changing the scale of a thermometer, and then telling a patient they no longer need to take medicine for their fever, and the whole family cheers that the illness is cured,’ said Xu Xiaonian, an economics professor at Shanghai's China-Europe International Business School.
‘The key is not which methodology to use, but whether local governments will massage the numbers,’ said Du Jinsong, a Hong Kong based property analyst for Credit Suisse Group.
