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China’s property prices fell by a record in March and new construction tumbled in the first quarter, dragging down growth in the world’s third-biggest economy.

Real-estate prices in 70 major cities fell 1.3 percent in March from a year earlier, the most since records began in 2005, the National Bureau of Statistics said in a statement on its Web site today. New construction by floor area fell 16.2 percent in the first quarter, it said.

Today’s figures also contained signs that the real-estate industry may revive as lending surges and the government implements a 4 trillion yuan ($585 billion) stimulus package. Spending on real-estate development grew 4.1 percent in the first quarter, up from a 1 percent gain in the first two months, and property sales jumped, the statistics bureau said.

“Property sales are in an early recovery in major Chinese cities as prices drop to an acceptable range for some buyers,” said Xing Ziqiang, an economist at China International Capital Corp cash loans with bad credit. in Beijing. “However, property prices may need to drop another 5 to 10 percent to ensure a sustainable recovery in both sales and property investment.”

Sales by floor area jumped 8.2 percent in the first quarter from a year earlier after dropping 0.3 percent in the first two months, the statistics bureau said.

China has seen “better than expected” signs of an economic recovery including a pick-up in industrial-production growth, surging lending, a smaller drop in exports and a rally by the stock market, Premier Wen Jiabao said April 11.

Poly Real Estate Group Co., China’s second-biggest publicly traded developer, said April 7 that first-quarter sales almost tripled from a year earlier.

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