Price Increase in New Homes in 100 Chinese Cities... Is the Rebound Starting?

Thanks to China's real estate market stabilization policies and economic stimulus measures, new housing prices have turned upward.

According to a report by the China Index Academy on the 1st, the average price of newly built homes in 100 Chinese cities last month was 16,184 yuan (approximately 3.01 million KRW) per square meter (㎡), marking a 0.5% increase compared to the previous month. Chinese local media China Economic Net reported that this ended a four-month consecutive decline in month-on-month prices since May this year.

[Image source=Yonhap News]

Housing prices in most cities either rose or remained at similar levels compared to the previous month. As of September, among the 100 cities, 44 cities saw price increases, 30 cities experienced declines, and 26 cities remained stable. China Economic Net explained that second-tier cities such as Xi'an, Hangzhou, and Hefei showed relatively high growth rates in prices.

The China Index Academy diagnosed that housing prices improved due to the launch of high-quality renovation projects in some cities, and policy adjustments such as offering benefits similar to first-time homebuyer incentives for those who currently do not own a home regardless of their loan history also had an impact. According to statistics from the China Index Academy, in September, cities including Beijing, Shanghai, Chengdu, Hangzhou, Tianjin, Suzhou, and more than 40 other cities implemented such expanded first-time homebuyer benefits. Guangzhou, Chengdu, Xi'an, and Xiamen lifted housing purchase restrictions.

However, prices for second-hand homes fell by 0.44% month-on-month to 15,556 yuan per ㎡ in the same month. The decline even widened by 0.06 percentage points compared to August.

The China Real Estate Information Corporation (CRIC) evaluated that overall, real estate companies' enthusiasm for project implementation is steadily recovering, key cities are successively easing housing loan restrictions, and transaction activities are rebounding as down payment burdens and purchase restrictions are relaxed. They also noted signs of recovery on a micro level and predicted that the recovery trend will continue in the future.

Meanwhile, China's Purchasing Managers' Index (PMI), announced the previous day, also rebounded, showing that the manufacturing sector entered an expansion phase for the first time in four months. According to the National Bureau of Statistics, the manufacturing PMI for September was 50.2, surpassing both the market forecast (50.0) and the previous month's figure (49.7). This is the first time in six months since March that the index has exceeded the threshold of '50,' which distinguishes expansion from contraction.

This content was produced with the assistance of AI translation services.