China's growth will slowly accelerate in the second half of 2012 after marking a "lower point" this quarter, according to comments by Zhu Baoliang, chief economist at the State Information Center's forecast department at a Beijing seminar today that were posted on a website controlled by the State Council Information Office.

China's State Council, or Cabinet, last week pledged to stick with existing property controls. The government has toughened requirements for down-payments and mortgages, and imposed restrictions on the number of homes each family is allowed to buy.

The drop in March home prices compares with 27 cities that registered a decrease in February, according to data today from the nation's statistics bureau. The bureau switched from a national average to individual figures for the 70 cities at the start of last year.

"The falling trend in prices reflects government policies, and these are unlikely to change this year, which is discouraging buyers," Dariusz Kowalczyk, a Hong Kong-based strategist with Credit Agricole CIB, said in an e-mail. "The housing market is the main risk to China's soft landing, one that we think will be controlled by the government but also one that needs to be closely watched."

David Fuller's view If this headline described recent developments in a western country it would indicate disaster. In China, it is evidence of the central government's success in partially deflating a bubble. If they can be equally skilful in preventing a collapse of prices they will have succeeded and China's next bull market will be underway. I am betting on the latter outcome.