People view the sandbox model of a real estate project in Taiyuan, North China's Shanxi Province, on June 17, 2024. Photo: VCG

China's real estate market showed positive changes during the week-long National Day holidays, as homebuyer confidence was revived by a new package of stimulus measures announced by the monetary authorities and individual Chinese cities recently to boost the healthy development of the important sector.

"Following the recent new policy pivots, inquiries for prior-dwelled homes in Beijing increased notably, as more people are now eligible to buy homes in the capital city," a Beijing-based property broker named Xia Zhiwei told the Global Times on Sunday.

Between October 1 and noon of October 3, the number of on-site inquiries for new homes in Beijing rose 92.5 percent on a yearly basis, and new home subscriptions nearly doubled. And, inquiries for used homes in Beijing jumped by 104.1 percent, according to a report seen on the Ministry of Housing and Urban-Rural Development (MOHURD) website.

During the Golden Week holidays, over 1,000 property developers across the country launched more than 2,000 promotion activities including offering discounts and vouchers to boost sales of new homes. The majority of the real estate projects involved in the promotions saw client enquiries surge by 50 percent year-on-year, data from the MOHURD showed.

Pu Zhan, deputy director of the policy research center under the MOHURD, said that various promotions have led to positive changes in the real estate market, with increases in both inquiries and transactions.

Recently, more than 50 Chinese cities, including first-tier cities Beijing, Shanghai, Guangzhou and Shenzhen, adjusted their real estate policies, with a range of measures unveiled to boost local property sales.

Among the cities, Guangzhou announced that there will be no restrictions on the number of homes purchased by families or individuals with or without local household registration in the city, according to a circular issued by the municipal government. As a result, the number of on-site inquiries for new property projects in Guangzhou rose nearly 200 percent lately.

Policy adjustments

"For some time now, the authorities has released policies targeting sectors including the real estate and the stock market with an intensity rarely seen before," Song Ding, a research fellow at the China Development Institute, told the Global Times on Sunday.

The Political Bureau of the Communist Party of China (CPC) Central Committee held a meeting on September 26, and emphasized that ramped-up efforts will be made to stabilize the property market and reverse its downturn.

The meeting pointed out that the authorities will adjust housing purchase restrictions, reduce interest rates on existing mortgages, promptly improve land, fiscal, tax and financial policies, and promote a new model for real estate development.

The new round of property policies mainly focuses on improving the demand side, particularly addressing the evolving housing needs of many residents, according to Song.

On September 24, the People's Bank of China, the country's central bank, unveiled a new package of monetary measures, led by reductions in existing mortgage rates, in a bid to boost the country's real estate market and fire up consumer spending.

"Adjusting existing mortgage interest rates will have a positive guiding effect. The reduction in monthly payments should have a positive impact in boosting homebuyers' confidence," Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, told the Global Times.

Yan stressed the need to better pivot macro policy adjustments to help stimulate the housing market. "The development of the real estate sector in various regions in the country has their own characteristics, and it is crucial for local governments to hold autonomy in adjusting local property policies in line with their own conditions," Yan noted.

He said MOHURD's support for cities, especially the first-tier cities, to independently adjust real estate policies is a "forceful step" to elevate the market confidence and reignite homebuyers' enthusiasm. 

Stable growth expected

Analysts remain largely positive for the future development of China's real estate market. "As the new policies begin to produce effects, the market is expected to march toward relatively stable growth, starting from the fourth quarter this year," Song said.

"Thanks to measures like lowering the down payments of a property, the market activity and potential market demand have greatly increased, and gradually an equilibrium between home sellers and home buyers will be formed," he said.

China's central bank decided to cut mortgage rates and lower minimum down payments for the prior-dwelled homes, as well as to reduce mortgage rates on existing home loans - all effective measures aimed to promote urban property sales and revive the real estate sector. 

There is still great space for China's property sector to expand, bolstered by the country's ongoing urbanization and Chinese public's growing demand for good housing, Ni Hong, minister of the MOHURD, said at a press conference in August.

Nevertheless, as "market supply and demand shift, China's real estate market remains in the process of adjustment," Ni said. But positive signals have surfaced as various policy measures have started to take effect.

The ministry will continue to encourage local governments to run promotions and further implement the "white list" mechanism to ensure healthy competition in the real estate sector, which will enhance the long-term impact of the new policies, another official with the MOHURD said.