(Bloomberg) -- China’s home prices fell for a third consecutive month in November, adding to a property industry slump that’s hurting growth in the world’s second-largest economy. 

New-home prices in 70 cities, excluding state-subsidized housing, declined 0.33% last month from October when they fell 0.25%, National Bureau of Statistics figures showed Wednesday. Values in the secondary market slid 0.37%, down for a fourth month. 

Sentiment in China’s home market has been dented by a cash crisis among property developers following a regulatory clampdown on excessive leverage in the industry. Officials have eased up in recent weeks as their priority shifts to shielding the economy from the slowdown.  

A continued drop in prices may do little to entice prospective buyers as building delays sap confidence. That would worsen the already precarious financial position of many developers, which rely on proceeds from home sales for more than half of their cash inflows. 

An investor sell-off of China’s embattled developers deepened this week following anxiety over the financial health of Shimao Group Holdings Ltd., which was considered to be one of the sector’s stronger players. Financial markets had largely shrugged off the bond defaults of China Evergrande Group and Kaisa Group Holdings Ltd. last week. 

The market for new homes has yet to bottom out, China Real Estate Information Corp. analysts wrote in a report last week, adding that cash-strapped developers will likely resort to heavier discounts at the year’s end. 

China’s housing downturn is fueling concerns over economic growth, given that the sector accounts for about a quarter of gross domestic product. The central bank eased monetary policy earlier this month, and economists expect the Communist Party to order more fiscal spending next year. 

In an annual Central Economic Work Conference last week, the Party’s top decision makers maintained the basic stance that “houses are for living in, not speculation,” damping expectations for property stimulus. But their call for a “virtuous cycle” in the sector suggests the prospect for some easing to limit the downturn, UBS Group AG’s chief China economist Wang Tao said in a report this week. 

The industry is getting help from a pickup in home loans. Mortgages grew in November, the central bank said this week in a rare release of monthly figures. Some banks in the southern Chinese boomtown of Shenzhen have cut home mortgage rates, state broadcaster CCTV reported.

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