Beijing, December 22, 2024 – The Europe Today: China’s property market is witnessing clearer signs of recovery following a year of challenges, supported by targeted policies aimed at restoring confidence and spurring demand.
In September, the Political Bureau of the Communist Party of China Central Committee convened a key meeting, emphasizing the need for policy adjustments, including easing housing purchase restrictions, reducing mortgage interest rates, and improving fiscal, tax, and financial policies.
On September 29, the central bank instructed commercial banks to reduce interest rates on existing home loans by at least 30 basis points below the loan prime rate (LPR) by October 31, 2024. Major cities such as Beijing, Shanghai, Guangzhou, and Shenzhen followed suit, introducing measures to boost local property markets.
These efforts have led to tangible results. According to the National Bureau of Statistics (NBS), the decline in commercial residential home prices in 70 large and medium-sized cities narrowed on a year-on-year basis in November. October also saw a reversal in home transactions, with new home sales rising by 0.9% year-on-year and total transactions of both new and second-hand homes increasing by 3.9%.
Market analysts attribute this recovery to renewed confidence stemming from policy announcements. Lu Wenxi of Centaline Property highlighted the active participation in second-home transactions in cities like Shanghai. Similarly, real estate offices in Beijing report a surge in activity, marking the busiest period of the year.
The “white list” mechanism introduced in January has also played a crucial role, offering targeted financial support to eligible real estate projects. By the end of October, loans approved for such projects exceeded 3 trillion yuan (about 417.24 billion USD), with the figure expected to reach 4 trillion yuan by year-end.
Experts anticipate that the recovery, driven by policies aimed at stabilizing expectations, will continue. Gao Yuan, director of the Beijing Lianjia Research Institute, predicts lasting momentum as market confidence rebuilds.
Beyond stabilization, China’s housing policies are now shifting toward quality and sustainability, focusing on improving living conditions. Over 66,000 urban renewal projects were implemented in 2023, with another 54,000 planned for 2024.
Looking ahead, analysts underscore the importance of fostering market confidence and guiding expectations to ensure a resilient and sustainable rebound in the property market.
