Chinese home prices have dropped for a third straight month in November from a year-ago, suggesting that the property downturn in the world's second largest economy has worsened despite government efforts to revive the market.

Average home prices in 70 major Chinese cities were down an annual 3.7% in November, Reuters calculations of official data showed, and followed a 2.6% drop in October.

The November reading was the biggest drop since Reuters began computing nationwide housing prices.

Home prices fell year-on-year in 68 of the 70 major cities monitored by China's National Bureau Statistics (NBS), up from 67 in October.


Home prices fell 0.5% month-on-month in November. Prices dropped 0.8% in October.

The price fall came regardless of the government cutting interest rates and relaxing its lending rules.

Economists now believe that the decelerating property market, which accounts for about 15% of China's economy, could inhibit economic growth.

A senior executive at a mid-sized listed developer in Beijing told Reuters that the market may have already found the bottom of the cycle.

The executive said: "The recovery momentum is still weak. The property market should not get worse in future."

Tao Wang, China economist at UBS, said in a note: "We see GDP growth cooling further to 7% in Q4 2014, and to 6.8% in 2015 from 2014's anticipated 7.3%, as property-related headwinds offset any uplift from the US recovery or intensifying policy support."

Yu Liang, president of leading residential developer China Vanke said at the weekend that the nation was facing an inventory overhang that will take 13 months to clear.

Last week, official data showed property sales hit 132.2 million square meters in November, the highest level in the past 11 months, but still down 11.1% from a year ago.

The Communist regime cut interest rates in late November and relaxed its lending rules in October in a bid to energise the nation's property market.