Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
China's property sector continued to face pressure as new home prices fell 0.4% month-on-month and 2.7% year-on-year in December, marking the steepest annual drop in five months. Most cities recorded declines, and existing home prices also softened across tier-one to tier-three cities. Analysts highlighted the persistent drag on economic growth, while property investment and home sales fell significantly in 2025. Despite government efforts and financial support programs, smaller cities face prolonged inventory reductions, and the sector is undergoing a major adjustment with a focus on stabilising expectations.
China's new home prices fell again in December, highlighting ongoing challenges in the country's property market despite repeated government efforts to stabilise it. Official data from the National Bureau of Statistics (NBS) showed a 0.4% drop month-on-month, the same rate of decline as in November. On an annual basis, prices fell 2.7%, accelerating from a 2.4% decrease the previous month and marking the steepest annual decline in five months. Advertisement
Analysts said the persistent weakness in new home prices is likely to remain a drag on China's economic growth over the next two to three years unless more decisive measures are introduced. Of the 70 cities surveyed by the NBS, six saw price gains, while 58 experienced declines. Existing home prices also fell across tier-one, tier-two, and tier-three cities, indicating a continued softening in the secondary housing market.
A recovery in the property sector could strengthen household consumption by boosting perceived wealth and confidence, while helping to correct imbalances between housing supply and demand. Analysts expect that home prices in major cities may gradually stabilise. Smaller cities, however, particularly those with declining populations and limited industrial support, are likely to face a prolonged period of inventory reduction.
Official data for 2025 showed that property investment in China fell 17.2%, while home sales by floor area decreased 8.7%, reflecting the sector's ongoing slowdown. The property downturn traces back to mid-2021, when government policies aimed at curbing excessive borrowing triggered financial stress for developers. Large companies such as Evergrande and Country Garden have been particularly affected, struggling with heavy debts and incomplete projects.
China's financial regulator recently announced plans to promote the proper functioning of a government program that supports financing for residential projects stalled due to the crisis. Earlier this month, an article in Qiushi, the Communist Party's official journal, described the property sector as a key pillar of the economy with potential for transformation. The article emphasised the need for strong policy actions to stabilise market expectations as the sector undergoes a profound adjustment.
Source Reuters
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
