China's property market harbors great growth potential

There is still great potential and room for China's property sector to expand, bolstered by the country's ongoing urbanization and people's growing demand for good housing, the housing ministry has said.

Speaking at a press conference on Friday, Ni Hong, minister of housing and urban-rural development, said that China will focus on the task of providing the public with good housing, while revamping the housing and urban-rural development sectors in a coordinated manner.

With changes occurring in supply and demand, China's real-estate market is still in the process of adjustment. But positive signals have surfaced as various policy measures have started to take effect, the minister said.

DEMAND FOR GOOD HOUSING

Elaborating on the concept of good housing, Ni said that, while its standards might evolve along with social and economic development, the concept essentially features homes that are green, low carbon, intelligent and safe.

China's housing market has already entered a new development stage, where people in the country are now attaching greater importance to the quality of housing, Ni said.

With new expectations from homebuyers, it is time to leverage new technologies, products and materials in house building, the minister said.

Efforts should be made to encourage property developers and builders to shift from a high-speed, quantity-centered growth model to one focusing on improving quality, technology and services, which will help propel the transformation and growth of the housing and construction sector, Ni added.

Dong Jianguo, vice minister of housing and urban-rural development, said at the press conference that the country has made key progress on creating standards for good housing, and is working to build related mechanisms and optimize services.

China's urban housing market has made substantial strides. By the end of 2023, the per-capita housing construction area in urban areas exceeded 40 square meters, while the urban built-up area reached 64,000 square kilometers in the country.

As part of the urban renewal initiatives, the country has also built over 40,000 pocket parks and more than 100,000 kilometers of urban green paths, providing leisure and recreation venues for people and making cities more livable, said Qin Haixiang, vice minister of housing and urban-rural development.

SECURING SOUND SUPPLY

China has sought to meet the diverse housing demands of consumers with an adequate supply, aiming to stabilize expectations and bolster confidence in the property market.

As one of its latest efforts, the country is transitioning from the traditional pre-sale model to a "sales upon completion" approach, which has been implemented across various regions to mitigate risks associated with unfinished projects.

Under the new approach, houses can only be sold after completion. Developers must promise to do so when acquiring land from local governments, Dong said.

Despite the policy shift, ensuring the timely delivery of housing remains a pressing task for China. According to the housing ministry, nearly 4 million pre-sold homes are scheduled to be handed over to homebuyers by the end of this year.

To achieve this target, the country has launched a "white-list" mechanism to ensure that all qualified property developers have equal access to financing assistance.

Currently, commercial banks have offered approximately 1.4 trillion yuan (about 197.2 billion U.S. dollars) of loans to over 5,300 property projects, effectively boosting housing construction nationwide, according to Dong.

As urbanization continues nationwide, local governments are expanding the supply of affordable housing and rental options to meet the growing demands of the working class, the younger generation and new urban residents.

Data from the ministry shows that during the first seven months of this year, over 440 billion yuan was invested in the construction of affordable housing and makeshift housing for shantytown renovations.

Dong said these houses are integral to people's livelihoods, and the country must ensure they are well-built and of good quality.

Local governments must adhere to the standards for good housing, so that people can live in healthy and convenient residences, he added.