Latest home price data suggest an uneven recovery in China's housing market, with first-tier cities leading price increases.

Of the 70 cities monitored in January, new home prices climbed in 38, compared with 39 the previous month, the National Bureau of Statistics (NBS) said Friday. There were 24 declines, down from 27 in December, according to NBS data.

On an annualized basis, 25 cities posted increases with 45 falls, compared with 21 and 49 in December.

New-home prices rose most, 52.7 percent year on year, in Shenzhen, followed by Shanghai (21.4 percent) and Beijing (11.3 percent). Zhanjiang in Guangdong Province, performed worst, falling 4.9 percent.

Prices for existing homes also warmed up last month, with 37 cities up and 25 down. The average annual increase in first-tier cities was more than 20 percent, while prices in most third-tier cities fell. A huge overhang of unsold homes continues to limit increases in smaller cities.

Economist Ma Guangyuan believes prices in first-tier cities will continue to rise, but huge increases will not be sustained because the market is close to saturation.

Property took a downturn in 2014 with weak demand and a supply glut. Sales and prices fell and investment slowed, while the stock of unsold grew.

There were 719 million square meters of unsold homes at the end of 2015, enough to house nearly 24 million people at the Ministry of Housing and Urban-rural Development estimate of 30 square meters of living space per capita.

Taking homes under construction into account, China's housing inventory would hit 5.87 billion square meters by the end of last year, requiring at least five years to clear, Xia Dan, an analyst with Bank of Communications said in a report to clients.

To tackle the woes, policy makers made reducing the home supply glut one of their top priorities this year and announced a slew of measures. Last week, taxes on some property transactions were slashed and further reductions to the minimum down payments for first- and second-time home buyers was announced earlier this month.

Analysts expect more support measures to be unveiled this year as the country tries to bolster the property sector amid slowing economic growth.

The government would be likely to loosen restrictions on home purchase using public housing accumulation funds and continue to lower transaction taxes, Xia Dan said.