(Bloomberg) -- China’s home prices grew at the slowest pace in four months in May, underscoring the challenges the market is facing as economic growth loses momentum.

New-home prices in 70 cities, excluding state-subsidized housing, increased 0.1% last month from April, when they grew 0.32%, National Bureau of Statistics figures showed Thursday. Prices declined 0.23% in the secondary market, snapping three months of gains. 

The figures add to evidence of renewed weakness in the residential property market after sales and prices rallied briefly following a historical slump. China is considering a broad package of stimulus measures as pressure builds on Xi Jinping’s government to boost the world’s second-largest economy, Bloomberg reported this week.

The stimulus proposals, drafted by multiple government agencies, include measures designed to support areas such as real estate and domestic demand, according to people familiar with the matter. Regulators are seeking to lower costs on outstanding residential mortgages and boost re-lending through the nation’s policy banks to ensure homes are delivered, one of the people said.

China’s real estate sector is key for the economic growth outlook this year, as it accounts for about 20% of the country’s gross domestic product after including related industries. The fate of the sector also weighs on the global economy, given that it helps drive demand for commodities like iron ore and copper. 

Top-performing Chinese macro hedge fund Shanghai Banxia Investment Management Center has slashed its holdings in property stocks, just two months after predicting a major rebound in the sector. Citigroup Inc. downgraded earnings estimates and price targets on some Chinese property stocks, citing challenging market and liquidity conditions. 

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