(Yicai Global) March 11 -- Forty of China's major cities earned nearly CNY138 billion (USD20.5 billion) from land transaction fees last month, down by 27.5 percent on the year.

The figures continued the slowing trend from 2018, Securities Daily reported today, citing the latest data from the Shanghai Yiju Real Estate Research Institute.

Many plots in hot cities have been failing to sell because bids did not meet the reserve price since the second half of last year, said Wang Ruochen, a researcher at the institute. Revenue from land transfer fees has declined for the second straight month now, though policies and the economic environment have not changed significantly, he continued adding that the trend is likely to continue.

The central government's work report for this year aims to promote stable, healthy development of the property sector and real estate tax legislation, an indication that Beijing's stance on the market is not set to relax any time soon, Wang added, saying the national land market would continue to cool as real estate firms undergo financial strain.

Land transaction prices in the 40 cities that have published relevant data averaged CNY4,194 (USD624) per square meter in February, down 11.3 percent from a year earlier. Growth in the rates peaked in September 2016 and has been declining ever since, moving into contraction territory in March last year. Wang expects the price to keep shrinking in the first half of this year.

First-tier cities have increased land supply in core areas and transaction amounts and average prices have both increased in those metropolises, he added, saying the central government is still bringing in strict real estate control policies and premiums will remain low.

The amounts and average prices in second- and third-tier cities fell and are likely to keep declining, Wang said.

Editor: James Boynton