China home prices fall for 3rd straight month BEIJING (Reuters) - China's new home prices fell in December from November, a third straight month of declines, and analysts expect prices will fall further as Beijing sticks to its tightening campaign against the once-hot real estate market. Average new home prices across China dropped 0.3 percent in December from the previous month, deepening from a decline of 0.2 percent in both November and December, according to Reuters weighted house price index based on official data released on Wednesday. New home prices in December fell on a monthly basis in 52 of the 70 cities monitored by the National Bureau of Statistics and they were steady in 16 others. Wenzhou, a highly speculative market driven by wealthy entrepreneurs in the eastern coastal city, recorded the sharpest monthly decline, of 1.9 percent. Record numbers of unsold homes and more still under construction will likely force developers to cut prices further in the next few months, analysts said. "The home price fall deepened in December and will continue to drop as China keeps its property tightening stance in 2012," said Shi Qi, an analyst with CEBM in Shanghai. "Financing constraints will force developers to cut prices further before a peak of new supply comes in April," he added. In year-on-year terms, average new home prices nationwide rose 1.4 percent in December, down from 2.2 percent in November. But they fell in 8 cities, again led by Wenzhou with a drop of 6.9 percent. The numbers are consistent with an easing in consumer inflation in China, to 4.1 percent in December from three-year-high of 6.5 percent in July, enabling Beijing to tilt policies more towards protecting growth as Europe's festering debt crisis puts a dent in China's exports. Data published on Tuesday showed Chinese annual real estate investment growth slowed to 12.3 percent in December, the lowest in the year. Annual increase in China's gross domestic product also eased to a 2- year low of 8.9 percent in the fourth quarter. Against such a backdrop, China's top leaders have vowed to continue to thwart property speculation in 2012 even as Beijing fine-tune policies to spur first-time home purchases. Policymakers aim to let the steam out of the real estate market, a major driver of economic growth, without triggering a hard landing. Analysts in a Reuters poll last week said they expect China to cut downpayments this year for people buying their first homes but to keep restrictions in place against multiple home buyers. They expect average home prices to fall between 10 percent and 20 percent in 2012. Property shares .SSEP and the benchmark Shanghai stock index reversed gains in early trading and were trading down 0.3 percent and 0.7 percent, respectively, in the morning. Reporting by Langi Chiang and Nick Edwards; Editing by Ken Wills