For the first time in 23 months, prices of homes in most major Chinese cities declined in May, a proof that the country's once red-hot real estate market is slowly losing steam, a recent independent survey showed.

According to the China Index Academy, average new home prices in 100 major cities in the country dropped by 0.32 percent from April to 10,977 yuan, or roughly US $1,750, per square meter, the lowest price since June 2012.

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Of the 100 major cities surveyed, 62 cities registered decline in prices with only one city showing unchanged new home rates, the academy announced. The biggest monthly dropped was registered in Guangdong's Shantou City, where new home prices fell 3.64 percent in May from April.

The academy said the price drop was triggered by property developers' pricing strategy and adjustments due to a rise in new homes supply and sharp falls in transactions. Developers, the academy said, needed to beef up promotions and adjust their rates to attract new home buyers.

While the month on month rate declined, new home costs increased by 7.84 percent in May on a yearly basis. But still, 31 of the 100 cities covered in the survey registered price drop on an annual basis, led by Wenzhou, whose new home prices fell 8.3 percent in May from a year ago.

Experts said the result of the latest survey showed that China's property market is cooling, after years of being a red-hot market, due to several factors, including stricter bank loan rules, financial trouble among developers, economic slowdown, and expectations of falling prices.

When the property market was red-hot, China introduced several measures to contain the rising new home prices. These included the construction of affordable housing and restrictions on buying second and third houses. The government also implemented higher minimum down payments and taxes to discourage buyers from purchasing new homes.

TagsChina New Homes, China Property, China Real Estate, Cost of China Homes, New Home Prices in China