Strong confidence, policies fuel property market recovery

BEIJING — Driven by a series of pro-housing policies, China's property sector has gained momentum in recent months, with increased transaction activity and renewed development vitality among real estate enterprises, signaling a shift toward a healthier and more sustainable growth trend.

With improving sentiment among homebuyers, transactions for both new and secondhand homes in multiple cities have shown an upward trend since the beginning of this year, fostering a more balanced relationship between supply and demand in the market, according to industry analysts.

New residential home sales in Beijing surged 47.11 percent year-on-year last month, with 2,295 units recorded in online sales contracts. Meanwhile, secondhand home transactions, a key segment of the city's property market, saw a 92.3 percent increase during the same period, according to data from leading real estate website Fang.com.

In Hangzhou, Zhejiang province, a second-tier city and hub for leading sci-tech firms, the number of daily visits to a new residential site in Xihu district, developed by Vanke, surpassed 100 groups during the first weekend after the Spring Festival holiday, double the figure from the previous week.

This trend can be attributed to improving customer sentiment, driven by the city's rising prominence and promising development prospects, according to the project's marketing manager.

The growing turnover volume has helped relieve destocking pressure in the property market. The average destocking period for new residential homes in 100 Chinese cities was 21.3 months in January, a remarkable drop from the previous peak of 26.8 months, data from the E-house China R&D Institute showed.

"The shorter destocking cycle will create more favorable conditions for achieving a balanced supply and demand relationship in the real estate market throughout the year," said Yan Yuejin, deputy director of the institute.

As the property market continues to rebound, leading domestic and foreign real estate developers are accelerating land acquisitions and leveraging expanded financing channels, signaling a broader recovery trend across the industry.

Shanghai's first batch of land auctions for 2025, which began on Feb 20, saw a strong return of property developers eager to acquire land. Gemdale Group made its first land purchase in the city in 21 months, while Singapore-based developers Frasers Property and Kheng Leong Co joined the bidding, bringing the total transaction value to 15.93 billion yuan ($2.19 billion).

Poly Developments and Holdings Group recently announced the purchases of six land parcels in cities like Guangzhou and Foshan in Guangdong province, and Sanya in Hainan province, with total investments nearing 10 billion yuan. Meanwhile, Vanke secured four development sites in Tianjin, Hebei province's Tangshan, Guangdong's Guangzhou and Guizhou province's Guiyang, covering a combined land area of 213,000 square meters.

Analysts believe the latest acquisitions by leading developers signal renewed confidence about the sector's prospects and growing optimism in the market's long-term outlook as government support measures gain traction.

Since last year, Chinese policymakers have introduced a series of measures — from financial stimuli to regulatory adjustments — to bolster the property sector. These include mortgage rate cuts, lower down payment requirements, eased purchase restrictions and financing coordination mechanisms to enhance funding support for developers.

According to data from the National Financial Regulatory Administration, the approved loan amount for "white list" projects, designed to support companies with reasonable financing needs, reached 5.6 trillion yuan by Jan 22, surpassing the initial target of 4 trillion yuan.

As China navigates further policy support for the sector, it has vowed to actively promote the use of local government special bonds for efficient management of idle land and disposal of existing commercial housing, while leveraging financial tools such as loans and bonds to support stable financing for the real estate sector, according to an official in charge of the mechanisms.

Chinese property companies have also experienced positive shifts in financing through more diversified channels, including domestic and overseas bond markets. These developments reflect improved financing capabilities of the enterprises and stronger confidence among foreign institutions in these developers, according to Yan.

In January, bond financing of real estate enterprises reached 50.98 billion yuan in total, with declining interest rates compared to the same period last year, data from the China Index Academy showed.

Last month, Greentown China announced the issuance of $350 million in dollar-denominated bonds maturing in 2028. This marks the first dollar bond issuance by a private real estate enterprise this year, and industry experts believe it will encourage more real estate enterprises to resume overseas financing.

As market-stabilizing policies take effect, the upward trend across the industry will become increasingly evident, pushing the entire industrial chain in the sector into a positive recovery cycle, said Zhang Yan, an analyst from property research institution CRIC.

Looking ahead, China is expected to see a recovery in both supply and demand in the property sector and month-on-month turnover growth during the peak sales season known as "Golden March and Silver April," with sales surges likely to occur in multiple cities, according to the CRIC.

Xinhua