Home prices in China reported their fastest growth in two years in April, with average prices in 70 cities tracked by the government climbing 6.2 percent in April from a year earlier — the fastest since April 2014. According to data released Wednesday by the National Bureau of Statistics (NBS), home prices rose in 46 of 70 cities on an annual basis and in 65 cities on a month-on-month basis — the most cities since December 2013.

The price growth was driven by looser lending policies, including low interest rates and transaction taxes, that helped spur sales beyond the top-tier cities of Beijing, Shanghai and Shenzhen. According to a Bloomberg calculation, house prices in the city of Hefei, located in the Anhui province, rose 5.7 percent over the past month — the fastest among the 70 cities tracked.

“Growth in first and second-tier cities continued to accelerate, while third-tier cities reversed declines to post growth,” Liu Jianwei, a senior statistician at NBS, told Reuters. “A change was observed in the growth trend among cities ... secondary homes in Shenzhen even posted a month-on-month drop, while growth in some of the second-tier cities accelerated and exceeded first tiers.”

Although Shenzhen and Shanghai remained the top performers on an annualized basis, with home prices rising 62.4 percent and 28 percent, respectively, growth on a monthly basis showed signs of slowing. In Shanghai, prices rose 3.1 percent month-on-month — down from 3.6 percent in March — while in Shenzhen, growth eased to 2.3 percent from 3.7 percent in the previous month.

In recent months, demand for houses in the world's second-largest economy has surged amid expectations that property prices would continue to rise in the coming years. The property sector — which many believe drove China’s first-quarter growth of 6.7 percent — has also provided investors an alternative to the country’s tumultuous stock market.

However, the housing market’s contribution to the Chinese economy has been falling in recent years, and many now fear that the rapidly forming property bubble may soon burst.

“The current housing rebound is a consequence of accumulated credit loosening since the middle of last year, which makes it unsustainable,” Zhao Yang, an economist at Nomura Holdings, told Bloomberg. “Now that the credit policy shows signs of moderating, a correction in housing sales and prices could loom faster than everyone expects.”