BEIJING - PRICES paid for homes in China rose in June for the first time in seven months, adding to signs the world's third-largest economy might be rebounding from its slump, according to data reported on Friday.

Housing prices in 70 large and medium-size cities rose 0.2 per cent in June from a year earlier and by 0.8 per cent compared with May, the Cabinet's National Development and Reform Commission reported.

Economists have pointed to increased activity in residential and commercial real estate as signs China is emerging from its slump as Beijing's 4 trillion yuan (S$855.7 billion) stimulus plan pumps money into the economy.

Real estate also is expected to help drive a recovery as sales circulate money through the economy and families spend to furnish new homes.

Other indicators also are improving. June bank lending was more than double the May level while retail sales, investment and factory activity have been rising.

After years of double-digit increases, prices paid for homes in China fell for the first time on record in December, declining by 0.4 per cent. Prices suffered their biggest decline in March with a 1.3 per cent fall from a year earlier. -- AP