Home prices decline in most Chinese cities in August

Zhang Dawei, chief analyst at real estate agent Centaline Property, said the current "adjustments" seen on the property market will continue into the second half of the year but the scope of the adjustment will depend on the credit policy.

Potential home buyers tend to take a wait-and-see attitude as banks become stricter in issuing home loans, according to the analyst.

Zhang forecast the volume from contracted sales is likely to bottom out in the fourth quarter and the prices will probably not stabilize until the first quarter of 2015.

China's GDP grew 7.4 percent in H1 with deepening reforms and targeted loosening, but in the last two months, declining PMI, sluggish industrial production and a cooling property market alerted investors to the stability of growth.

"The government will not be distracted by short-term fluctuations of individual indicators." Premier Li Keqiang assured global CEOs at the Summer Davos forum last week. "We have focused more on structural adjustment and other long-term problems," he stressed.

Meanwhile, the government has stepped up construction of affordable housing and shantytown renovation projects to help boost regional growth. By the end of July, 3.4 million units of affordable housing had been completed, or 70 percent of the government's annual target.

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