China home prices remain weak, keeping pressure on economy

Broader indicators showed little sign of a turnaround, with property sales, investment, and new construction starts all tumbling in the first eight months of the year, according to separate data.

Household loans, including mortgages, shrank by 202.9 billion yuan ($30.2 billion) in August, following a 460.3 billion yuan contraction in July, showing a reluctance by households to borrow.

Economic growth slowed to 4.3% in the second quarter and data on Tuesday indicated that the world's second-largest economy would continue to rely on external demand to offset soft domestic consumption and an investment downturn.

"We now expect the housing downturn to persist through the current Five-Year Plan, with residential investment not recovering until 2031," said Sheana Yue, senior economist at Oxford Economics, in a research note on Tuesday.

"A more proactive policy response is increasingly needed to revive domestic demand," Yue said. "We have lowered our 2027 growth forecast to 4.3%, reflecting a more prolonged property downturn which is likely to keep growth subdued despite stronger public investment."