On October 16, in an interview with a reporter from China News Service, we discussed the recent adjustments in China’s real estate policies following a significant move by major cities like Beijing, Shanghai, Guangzhou, and Shenzhen last month. Observers noted that several key second-tier cities have followed suit in October, indicating a trend of sustained market support and a potential stabilization of market expectations.
On the same day, Tianjin made headlines by announcing the removal of various housing restrictions, including limits on purchases, sales, and pricing. The new policies state that all restrictive measures related to buying and selling new and second-hand homes in the city will be eliminated. Furthermore, there will no longer be a price ceiling for newly constructed homes, and the standards for ordinary and non-ordinary housing will be lifted.
Niu Xiaohui, a senior analyst at the China Index Academy, commented on the shifting dynamics of Tianjin’s housing market. She highlighted how demand has increasingly concentrated in the core areas over the years, with new housing transactions in these districts rising consistently for four years. The removal of purchase limits and the reduction of down payment ratios are expected to stimulate demand from both local residents looking to upgrade and external buyers, thus revitalizing the market.
Tianjin has been one of the few major cities previously enforcing housing purchase restrictions, and industry experts believe this move is historically significant. Yan Yuejin, vice president of the Shanghai E-House Real Estate Research Institute, explained that with Tianjin removing purchase limits, the “purchase restriction circle” has shrunk, indicating a broader trend of exiting such policies that have been in place in many larger and mid-sized Chinese cities since 2010. Currently, only Beijing, Shanghai, Shenzhen, and some cities in Hainan maintain these restrictions.
On October 15, Chengdu also unveiled four real estate policy documents aimed at fostering market growth. These documents relax holding periods and introduce support for land sales. Notably, new home buyers in Chengdu, with certain exceptions, can list their properties for sale immediately after obtaining ownership certificates. The regulations further assist families with two or more children by simplifying their access to commercial loans for their first housing purchase.
Additionally, on October 9, Hangzhou implemented what industry experts have dubbed the “New Hangzhou Five Guidelines,” abolishing price limits on new homes. The new measures also standardized the minimum down payment ratio for personal housing loans at 15%, irrespective of whether it’s a first or second purchase, and increased the housing provident fund loan amounts.
Beyond loosening purchase restrictions, the current policy shift places significant emphasis on relaxing or eliminating price controls. According to incomplete statistics from the China Index Academy, over ten cities this year, including Zhengzhou and Shenyang, have removed price caps on new housing, while cities like Hangzhou and Quanzhou have lifted price requirements for newly released land. Furthermore, certain areas such as Shaoyang and Fuzhou are not imposing price floors for specific homebuyers or group purchases. These adjustments allow developers to adjust prices more flexibly, facilitating quicker cash flow while enabling higher premiums for better-quality projects to meet varying market needs.
Due to these concentrated policy efforts, the real estate market has shown signs of warming since the beginning of October. According to a recent report from the CREIS Research Center, the monitored 23 key cities experienced a 77% month-over-month increase in new home project subscriptions during the National Day holiday, representing a 65% year-over-year increase. Notably, the first-tier cities of Beijing, Shanghai, Guangzhou, and Shenzhen saw a staggering 102% increase compared to last year, while second- and third-tier cities had a 55% growth.
Yan Yuejin anticipates that in the fourth quarter, real estate policies across various regions will continue to be strengthened, helping stabilize the market further. Coupled with recent positive market sentiment, these developments have significantly contributed to the recovery and renewed confidence in the real estate sector.
