BEIJING (REUTERS) - China will maintain the principle that houses are for people to live in, not for speculation, President Xi Jinping said on Wednesday (Oct 18) at the opening of a key Communist Party congress.

The principle was first introduced by China's top leaders at an economic conference in December last year, as the country sought to crack down on rampant speculative buying in its property market through a flurry of government curbs.

Real estate has been a key growth driver for China, and is the main source of wealth for most Chinese citizens.

The authorities have announced a flurry of curbs to rein the red-hot property sector as home ownership has become increasingly unaffordable for a large portion of the population - gains in income have lagged house price growth in recent years.

Cooling measures applied so far appear to have dampened speculation as China's new home prices in August rose at the slowest pace in seven months and fell or levelled off in more cities.

Home prices in China's four tier-one cities declined for the first time this year by 0.3 per cent month-on-month in August after staying flat in June and July, in contrast with the 2 per cent to 4 per cent average monthly growth recorded prior to last September, when the government started a wave of restrictions, Xinhua news agency reported earlier.

"Price growth in first and second tier cities is likely to remain muted in the next six to 12 months as the current tight regulatory measures are unlikely to be loosened," Moody's vice-president and senior credit officer Kaven Tsang said in a recent report, according to Xinhua.