BEIJING (Reuters) – China’s property investment fell at a slower pace over the first two months of 2023, official data showed on Wednesday, showing signs of improvement buoyed by a slew of supportive policies though buyers and developers remain cautious.

The property investment fell 5.7% year-on-year in January-February, after a 12.2% slump in December, according to data from the National Bureau of Statistics (NBS), slower than the 10% decline registered for the same period in 2022.

China’s property sector, for decades a key pillar of growth in the world’s second-biggest economy, has been hobbled by multiple crises since mid-2021, including developers’ mounting debt defaults and buyers’ mortgage boycotts that have weighed heavily on demand.

Around half of the 30-odd Chinese developers listed in Hong Kong have defaulted on or delayed bond payments.

At the beginning of the annual meeting of China’s parliament last week, the government made guarding against risks to top property developers one of its top priorities this year in a work report, adding the country would prevent disorderly expansion by developers.

“The figures are a good start to the recovery of the property market for 2023 and further boost confidence,” said Yan Yuejin, analyst at the E-house China Research and Development Institution in Shanghai.

“Property sales figures are expected to turn from negative to positive in the first quarter of the year, the biggest sign that the property market is recovering.”

Home sales by floor area fell 3.6% year-on-year in the first two months of 2023, versus a 24.3% decline seen in 2022, as many families remain on the fence on home buying.

New construction starts measured by floor area fell 9.4% in January-February from a year earlier, after a 44% plunge in December, and a 39% tumble for the same period in 2022.

The situation for developers’ access to funds has also improved: funds raised by developers slumped 15% year-on-year in the first two months of 2023, compared with a 26% fall in the same period last year.

New home prices in January rose for the first time in a year, bolstered by policymakers’ aggressive support late last year and China’s abandonment of its zero-COVID policy.

Ni Hong, the minister of housing, said on the sidelines of the annual meeting of parliament that he is “confident” that the property market will stabilise and rebound in 2023.

(This story has been corrected to fix the sales data to -24.3% in 2022, not -26.7%, in bullets)

(Reporting by Liangping Gao, Ella Cao and Ryan Woo; Editing by Edmund Klamann and Kenneth Maxwell)