(Bloomberg) -- China’s home prices declined at a slower pace for both new and existing-units in January, the first signs of improvement in 10 months. 

New-home prices in 70 cities, excluding state-subsidized housing, dropped 0.37% last month from December, when they retreated 0.45%, National Bureau of Statistics figures showed Friday. The second-hand market also improved, with price declines narrowing to 0.68%. 

China is intensifying efforts to combat the property crisis, which has been a major drag on the world’s second-largest economy. China Evergrande Group received a liquidation order from a Hong Kong court last month, marking the largest collapse in the three-year downturn. 

Existing property values edged up in two cities featuring holiday homes, Sanya and Kunming. New-home prices gained in 11 cities, mostly tier-two regional centers. 

In both markets, the number of cities with rising home values picked up, the first time in 10 months. 

“The slide in home prices may have passed its worst period,” said Yan Yuejin, research director at E-house China Research and Development Institute. 

Policymakers have increased pressure on banks to boost their property loans through so-called white lists. In a flurry of activity, state-owned lenders have earmarked at least 124 billion yuan ($17 billion) of loans for property works eligible for support, state media reported this week. 

A range of housing projects from cash-strapped developers including Country Garden Holdings Co. and Sunac China Holdings Ltd. have been put on the lists, the firms have said. Authorities also called on local governments to better support developers’ financing needs through coordination with banks. 

The government also increased support for the troubled property sector with its biggest-ever cut to a key mortgage reference rate. That will allow more cities to reduce minimum mortgage rates, which can entice homebuyers as prices fall. 

Some market watchers caution that a meaningful sales rebound hinges on even stronger policies. A mild reduction in mortgages doesn’t help much, Centaline Group Group analyst Zhang Dawei said.

“These current measures may still not be enough to turn the market around,” said Larry Hu, head of China economics at Macquarie Group Ltd.

(Updates with more details, analyst comments throughout)

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