A recent uptick in land costs – typically a prelude to home price rises – have changed market sentiment and pushed would-be home buyers back to the market in a bid to beat increases.

China’s top state think tank warned last week that China should enforce new property controls next year to curb speculation and prevent an expected modest recovery in house prices from turning into a steep rebound.

The view was echoed by analysts.

“The Chinese government would like to keep the stability of the real estate market. If home prices and sales rebound too quickly next year, the government might unveil fresh tightening policies, including expanding property tax beyond Shanghai and Chongqing,” said Liu Yuan, a head of research at property consultancy Centaline.

Rocketing property prices were a major consequence of China’s last economic stimulus effort, the 4 trillion yuan ($635 billion) package launched in 2008 at the depths of the global financial crisis.

Compared with a year ago, however, home prices are still falling nationwide. The 0.7 percent drop in November was the ninth such decline but easing from a year-on-year fall of 1.1 percent in October, according to Reuters calculations.

Reuters started its weighted China home price index in January 2011 when the NBS stopped providing nationwide data. The NBS now only publishes price changes for each of the 70 major cities.

(Reporting by Xiaoyi Shao and Nick Edwards; Editing by Jacqueline Wong)