"Bottoming Out" Is the Consensus
China's property market is showing clear signs of stabilisation and recovery, according to a mid-year review published by Xinhua on July 27. The headline assessment — that the market's "bottoming and stabilisation trend is strengthening" — represents an upgrade from the cautious tone of early 2026, reflecting improving delivery data, clearing inventory and a more supportive policy backdrop.
Key Indicators of Stabilisation
- Unsold housing inventory: Falling for the fourth consecutive month as of June 2026, per NBS data
- New home prices: Rising in Tier-1 cities for four consecutive months through June
- White list financing: Extended to projects with up to 5-year loan rollovers, giving developers longer funding buffers
- 20 of 70 cities: Reported month-on-month new home price increases in June 2026
White List Mechanism Delivers
The property financing white list — which channels preferential credit to qualifying pre-sold projects with verified construction progress — has become the central tool for ensuring timely home delivery. With the rollover extended from roughly 2.5 to 5 years, developers can better align funding timelines with construction cycles, reducing the risk of project stall.
Supply-Side Reform
In parallel, the Ministry of Natural Resources has tightened land supply rules: new commercial real estate development land is, in principle, no longer permitted, and annual new urban-rural construction land additions are capped at the area of land revitalised — a 'revitalise one mu to add one mu' rule. This is designed to prevent future oversupply while clearing existing inventory.
Regional Differentials
Not all cities are recovering equally. Tier-1 cities — Shanghai, Beijing, Guangzhou and Shenzhen — are leading the rebound, with Shanghai recording 10,327 units sold in a single month (July). Secondary markets in lower-tier cities remain patchy, with transaction volumes stabilising but price recovery lagging.
Policy Outlook
The government's 4.28 Politburo meeting confirmed "stabilising the property market" as a priority, with policies focused on inventory control, demand-side support and quality supply rather than broad price stimulation. Analysts expect H2 to bring continued modest improvement in transaction volumes, with a more meaningful price recovery contingent on broader macroeconomic conditions.