China News Agency, Beijing, July 16th: How can China's property market regain confidence?

　　China News Agency reporter Pang Wuji

　　From 2022 to the middle of the year, China's real estate market has experienced a process from downturn to bottoming and stabilizing.

Especially in May and June, the sales of commercial housing continued to rebound, showing market resilience.

　　Signal: Sign of bottoming out in the short term

　　There are various signs that the property market has bottomed out in the short term.

In terms of transaction volume, according to official data, after China's commercial housing sales stopped falling and turned to increase in May, the sales area and sales value of commercial housing in June increased by 65.8% and 68.1% respectively, and the growth rate was significantly higher than that of the previous month. About 40 percentage points, the market activity has increased.

　　From the perspective of housing prices, the number of cities with rising new and second-hand housing prices both increased in June, and the average decline in housing prices narrowed.

Some first- and second-tier cities have a strong recovery momentum.

In the month, the prices of new houses and second-hand houses in Chengdu increased by 1.3% and 2% respectively from the previous month, showing strong growth for many consecutive months.

The prices of new houses in Hangzhou, Beijing and Qingdao rose by 1%, 0.8% and 0.6% respectively.

　　In June, the national real estate development investment scale also achieved "two consecutive increases" from the previous month, and reached a new high in the year.

The bottom of the real estate market has stabilized.

　　However, the current real estate indicators are still at historically low levels, and the foundation for recovery is not yet solid.

The China Index Research Institute pointed out that in June, the year-on-year decline in the cumulative sales of commercial housing narrowed significantly, which was related to the concentrated release of the backlog of demand during the epidemic and the intensified efforts of housing companies to promote sales in June.

　　The sticking point: Weakening expectations

　　Since the beginning of this year, the policies of "stabilizing the property market" in various places have been released at an average frequency of more than two pieces per day, but the real estate climate index has not shown a significant rebound, which is completely different from the performance of the past few rounds of property market cycles.

What is the crux?

　　Ni Pengfei, director of the Urban and Competitiveness Research Center of the Chinese Academy of Social Sciences, believes that before last year, the property market was expected to remain optimistic, with policies playing a leading role, and the property market would heat up as soon as policies were loosened.

However, since last year, external shocks and the release of real estate market risks have weakened expectations for the real estate market.

　　Li Yujia, chief researcher of the Housing Policy Research Center of the Guangdong Provincial Urban Planning Institute, also said that the key to solving the problem lies in the recovery of the market and the activation of transaction volume, which is also the premise to boost confidence and reverse expectations.

　　Thanks to a series of boosting policies this year, Ni Pengfei said that the real estate market is currently undergoing a transition from a negative cycle to a positive cycle.

He suggested taking decisive measures, including adjusting control policies, real estate financial policies, etc., to stabilize the property market as soon as possible.

　　Trend: Long-term potential remains

　　Yu Liang, chairman of the board of China's leading real estate company Vanke, believes that the property market has bottomed out in the short term, but the recovery will be a slow and gentle process.

　　Yang Hongxu, vice president of the E-House Research Institute, also believes that from the data point of view, it is unlikely that a "V"-shaped rebound in the property market will occur this year, and the recovery of the property market may be characterized by a "U" shape, which also means that the bottom hovering time may be longer than before. Several cycles are long.

　　Li Yujia also pointed out that the epidemic has lasted for more than two years, which has affected the income expectations of some residents.

Therefore, the trend of real estate bottoming out and rebounding still faces challenges, and the short-term future will be a period of "grinding the bottom" or consolidating the bottom.

　　However, in the medium and long term, Ni Pengfei pointed out that there is indeed a structural potential in the real estate market, especially in metropolitan areas, urban agglomerations and some cities with relatively good economic development and large population inflow. The transaction size of 1.5 billion square meters.

　　Xu Xiaole, chief market analyst of the Shell Research Institute, pointed out that the Shell Research Institute estimates that before 2035, there will still be more than 20 billion square meters of housing demand in China, and the proportion of improvement demand is gradually approaching 60%.

Under the support of housing demand, China's property market will enter a new stable center.

(Finish)