China's new home prices fell at the fastest pace in more than nine years in August, official data showed on Saturday, as supportive measures failed to spur a meaningful recovery in the property sector.

New home prices were down 5.3% from a year earlier, the fastest pace since May 2015, compared with a 4.9% slide in July, according to Reuters calculations based on National Bureau of Statistics (NBS) data.

In monthly terms, new home prices fell for the 14 straight month, down 0.7%, matching a dip in July.

The property market continues to grapple with deeply indebted developers, incomplete apartments, and declining buyer confidence, straining the financial system and endangering the 5% economic growth target for the year.

A Reuters poll predicted China's home prices will fall by 8.5% in 2024, and decline by 3.9% in 2025, as the sector struggles to stabilise.

China's property market is still in the process of gradually bottoming out as home buyers' demand, income and confidence will take some time to recover, said Zhang Dawei, chief analyst at property agency Centaline.

"The market is looking forward to a stronger policy."

Property investment fell 10.2% and home sales slumped 18.0% year-on-year in the first eight months, according to official data also released on Saturday.

Chinese policymakers have intensified efforts to support the sector, including reducing mortgage rates and lowering home buying costs, which has partly revitalised demand in major cities.

Smaller cities, which face fewer home purchase restrictions and have high levels of unsold inventory, are especially vulnerable, highlighting the challenges faced by authorities to balance demand and supply across various regions.

Of the 70 cities surveyed by NBS, only two reported home price gains both in monthly and annual terms in August.

"With our view of a worsening growth slowdown under new headwinds in H2, we expect Beijing will be eventually forced to serve as the builder of last resort by directly providing funding to those delayed residential projects that have been pre-sold," said Nomura in a research note on Friday.

China may cut interest rates on over $5 trillion in outstanding mortgages as early as this month, according to Bloomberg News.

To support mortgage rate cuts, a cut of five-year Loan Prime Rate is likely in September, complemented by a 20bp cut of medium-term lending facility (MLF) and 50bp cut to the reserve requirement ratio (RRR), economists at ANZ said in a research note on Friday.