The government has spent more than four years trying to tame record home prices on concerns that they were stoking an asset bubble, and some see the efforts bearing fruit.
"The current property market is just cooling down mildly from the red-hot situation seen in past years, which is actually quite good for the healthy development of the industry," said Chen Guoqiang, vice chairman of China Real Estate Society, a property policy research body.
But too sharp a fall in a sector that supports some 40 other industries, ranging from cement to furniture, may set off alarm bells about potential bad debt and drag further on the economy, which marked its slowest growth pace in 18 months in the first quarter.
The NBS data showed home prices increased year-on-year in 69 of the 70 cities monitored, unchanged from February. Wenzhou, a center for private businesses, was the only city where house prices fell in March, dropping 3.9 percent from a year ago.
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On a month-on-month basis, four cities, including Wenzhou and Haikou in the far south, saw home prices drop, while 10 cities, including Hangzhou and Ningbo, saw prices unchanged from the previous month, the NBS said.
Price gains also eased in the country's wealthiest cities, including Beijing, Shanghai, Guangzhou and Shenzhen, but the four still saw double-digit year-on-year growth.
Official data on Wednesday showed marked decelerations in property investment and sales and a contraction in housing starts in the first quarter.