Secondary Transactions Account for 50.4% of National Housing Sales in H1 2026
For the first time in China's modern housing history, secondary home transactions overtook new home sales in terms of total volume during the first half of 2026 — a structural shift that analysts describe as a defining moment for the world's second-largest housing market. According to data from the Ministry of Housing and Urban-Rural Development (住建部), secondary home transaction network contract area reached 48,218 million sqm in January–July 2026, up 10.2% year-on-year, while new commercial housing sales area fell 11.8% to approximately 450 million sqm over the same period.
18 Provinces and Municipalities Now See More Secondary Than New Home Transactions
Secondary home transactions exceeded new home transactions in 18 provinces and municipalities, including Beijing, Shanghai, Jiangsu, and Guangdong. Cities including Beijing, Shanghai, and Zhengzhou recorded their best July secondary home transaction volumes in five years during July 2026, underscoring the sustained momentum of the secondary market.
On a monthly basis, national secondary home prices in first-tier cities rose for the fifth consecutive month in July, up 0.2% month-on-month, with Shanghai leading at +0.3%, Guangzhou at +0.4%, and Shenzhen at +0.2%.
Why Buyers Are Flocking to Secondary Homes
The shift toward secondary housing reflects several converging factors. First, secondary properties typically carry lower absolute prices, bringing homeownership within reach for more buyers as mortgage affordability improves. Second, secondary homes are often located in more mature neighbourhoods with established infrastructure, schools, and transport links — factors increasingly valued by demographics including new urban residents and young families seeking stability over novelty.
Third, the "price-for-volume" dynamic has been critical: sellers willing to accept price concessions have been able to complete transactions, fuelling market liquidity even as headline prices remain under pressure. The secondary market has also benefited from the growing prevalence of "trade-in" (以旧换新) schemes, where homeowners sell their existing property to purchase a new one, creating a linked chain of transactions.
Policy Response Adapts to the Structural Shift
Regulators and local governments are actively adapting policy frameworks to the new market reality. The government's 15th Five-Year Plan for Expanding Consumer Spending explicitly positions housing as a "major durable consumer good" — a significant rhetorical shift from the "housing is for living, not speculation" (房住不炒) framework that dominated policy from 2016 to 2025.
The secondary market's ascendancy also carries implications for urban planning and developer strategy. With new housing starts declining 23.1% in H1 2026, developers are increasingly pivoting to urban renewal, renovation, and property management services — business lines better suited to a market where existing stock dominates transactions.