Property sector showing signs of bottoming out

China’s property market is stabilizing after a series of policy interventions, with new commercial housing sales rising year-on-year and month-on-month in October and November. The Ministry of Housing and Urban-Rural Development attributed the recovery to recent measures, including reducing the minimum down payment to 15% across all housing categories and relaxing purchase restrictions. New tax incentives introduced in November in major cities like Beijing, Shanghai, and Shenzhen further lowered transaction costs for homebuyers. Policymakers now aim to sustain momentum by focusing on demand and supply optimization, including accelerating the redevelopment of urban villages and dilapidated housing. In October, authorities launched an initiative to renovate 1 million additional homes in rundown urban areas, expanding support to nearly 300 cities from the previous 35 major ones. Analysts estimate this could lead to the sale of nearly 10 million square meters of new residential properties, citing lessons from a similar program between 2015 and 2017. On the supply side, local governments are encouraged to use special-purpose bonds to reclaim idle land and enhance facilities for purchasing unsold commercial homes as affordable housing. However, inventory clearance remains uneven: Shanghai and Hangzhou have reduced backlogs to under 10 months, while many second-tier cities still face overhangs exceeding 20 months, according to China Index Academy data. Experts emphasize that while progress has been made, sustained efforts are needed to ensure a solid recovery in 2025. Huang Yu of China Index Academy noted that demand-side measures and supply optimization will be critical to improving living conditions and solidifying the market’s positive trend.