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BEIJING, April 20 (Reuters) - The municipal government of China's capital said on Wednesday that new property curbs unveiled in March have started to cool the red-hot housing market, but it will take some time before the frothy market stabilises.
Beijing, a bellwether of national policy direction, is on the frontline as China takes on speculators and tries to tame home prices.
It announced new curbs in mid-March as prices and sales picked up again, shrugging off measures implemented late last year.
The new measures included raising the minimum downpayment on a second home to 60-80 percent from 50-70 percent depending on the types of the homes.
The Beijing government said on Wednesday that online transaction volumes fell 16.7 percent in the 10 days after the new curbs were implemented on March 18, compared to the level in the previous 10 days.
Property sales by floor area also dropped 15.4 percent compared to a year ago in the first quarter, it said, a pace 5 percentage points quicker than in the first two months of the year.
The city government also singled out the resale market, stressing it has cooled significantly.
"With demand dropping, it's possible (Beijing) housing prices, especially in the resale market, may drop," a spokeswoman from the city government said during a news conference, according to a script posted on the government website.
Data from the National Bureau of Statistic showed prices in Beijing's resale market surged 2.2 percent in March on a monthly basis.
New home prices rose 0.4 percent in Beijing in March from the previous month, after flatlining in the first two months of the year. Compared with a year earlier, Beijing home prices surged 19 percent.
But the spokeswoman conceded buyers may adopt a wait-and-see attitude as it takes time for policy adjustments to sink in.
"The impact of the new policies will become increasingly visible in April or in the even longer term," she said.
The housing boom has been a key driver in China's stronger-than-expected economic performance in recent months, but analysts believe it may also pose the single biggest risk to China's growth this year.
Local governments are imposing ever tougher measures to get sharp prices rises under control, which are expected to slow real estate investment and construction eventually. (Reporting by Yawen Chen and Nicholas Heath; Editing by Kim Coghill)