Chinese house price slump continues by Geoffrey Smith @FortuneMagazine October 24, 2014, 8:16 AM EDT E-mail Tweet Facebook Google Plus Linkedin Share icons The decline in China’s housing sector continued in September, with prices for new homes falling in all but one of 70 major cities surveyed.The National Bureau of Statistics said that prices for new homes fell by up to 1.9% in the cities surveyed, with drops of 0.7% in Beijing and 0.9% in Shanghai. Prices for existing homes fell in all 70 cities, with drops of between 0.5% and 2.0%.The figures suggest that recent measures by the People’s Bank of China to support the market haven’t succeeded in turning it round, at least yet. The central bank recently cut downpayment requirements for those buying a second property to 30% from over 60%, the same level as first-time buyers enjoy.The numbers add to unease about the unwinding of a speculative bubble in the country’s real estate sector, which analysts fear may lead to a big rise in bad loans among its banks.China Construction Bank Corp CICHY said Thursday bad loans rose to 1.13% of its total portfolio in the third quarter, from 1.04% at the end of the second quarter. While that’s still well below the level that analysts would consider stressed, the increase of 0.09% was faster than the 0.02% reported in the previous three months. Overall bad loans in the sector were at their highest in three years in June, according to the PBoC at 1.08%.Analysts worry, however, that official data may not capture the full picture, as much of the credit to the real estate sector goes through the informal, or shadow, banking sector.New loans through such shadow banks have fallen sharply in recent months, as most regions struggle with excess supply after years of over-building.A survey by China’s Southwestern University of Finance and Economics in June said that more that 20% of homes in urban areas were actually vacant, while as of August, around $674 billion was owed on empty properties.In the last six weeks, the PBoC has injected an extra $100 billion in liquidity to the country’s largest banks in the form of three-month loans to ensure that a slowdown in the real estate sector doesn’t make credit markets seize up.The real estate slowdown has contributed to the economy’s overall growth rate falling to its slowest in five years. The government said earlier this week that gross domestic product grew only 7.3% year-on-year in the third quarter, short of the government’s 7.5% target.