by WANG Yuhan

In the first half of 2025, more than 100 policy measures were introduced across the central and local levels to stimulate housing demand, reduce inventory and mitigate risks. While overall home sales are still declining year-on-year, the drop has narrowed, price declines have moderated, and signs of stabilization have emerged.

YANG Yuejin, deputy director of the E-House Real Estate Research Institute, told Jiemian News that the market is "shifting toward new development," building on last year's policy package that halted the slide. This year, he said, is about finding new directions through policy innovation and supply-side improvements.

At the central level, Beijing has steadily reinforced its pro-market stance. From the March Government Work Report to the June State Council Executive Meeting, policymakers have signaled firm support for restoring market confidence, with a focus on reducing mortgage costs, unlocking demand, and easing delivery risks.

The five-year LPR was cut to a record low of 3.5 percent, with first-home public fund loans as low as 2.6 percent. On the supply side, local governments expanded land repurchases and urban village renewal. Progress on housing delivery also accelerated, with over 16 million units underwritten by 6.7 trillion yuan in approved loans.

A standout theme has been the push for "good homes"—higher quality, better-designed housing. Since the phrase was written into the 2025 Government Work Report, about 20 provinces have issued local guidelines. Regulations now include stricter standards on layout efficiency, noise insulation, and actual usable space.

More than 170 cities and counties rolled out over 340 stabilization policies in the first half. While cash subsidies and housing vouchers were widely used, cities like Shaoxing offered larger incentives for multi-child families—up to 40,000 yuan for those with three or more children.

Top-tier cities led the recovery, with high-end housing in central Shanghai and Beijing seeing absorption rates above 80 percent. Units in the 120–144 sq m range now account for over 30 percent of new home sales in major markets. In contrast, smaller cities remain in a price-for-volume phase.

Land supply tightened, but core cities released higher-quality plots, intensifying competition among developers. While residential land supply across 300 cities fell nearly 20 percent, land revenue rose 27.5 percent, with average premiums climbing to 10.2 percent. Shanghai and Hangzhou recorded multiple plots selling at over 40 percent premiums.

Looking ahead, analysts expect the market to stay split between premium "good homes" in major cities and oversupplied lower-tier regions. Sustained recovery will require further structural reforms and continued policy support.