In a coordinated effort to reverse the property sector’s downward trend, high-ranking Chinese officials have announced a series of gradual but significant measures. The plan, detailed at a press conference in Beijing, involves multiple government bodies working together to stabilize the housing market, a critical part of China’s economy. The new policies focus on boosting financial support, renovating urban areas, and giving local governments more flexibility.
Injecting Billions into Real Estate Projects
A key part of the government’s strategy is to increase financial support for developers through the “white list” mechanism. This program helps ensure that viable real estate projects get the funding they need to continue.
Xiao Yuanqi of the National Financial Regulatory Administration confirmed that loans approved for these “white list” projects have already reached 2.23 trillion yuan (about $313.11 billion). This figure is expected to grow substantially by the end of the year.
The total loan amount is projected to exceed 4 trillion yuan, showing a strong commitment to prevent financing issues from stalling the market’s recovery. Additionally, the People’s Bank of China (PBOC) is exploring loan programs to help qualified companies buy idle land, aiming to encourage new development.
Renovating Homes to Stimulate Demand
The government is also launching a major initiative to upgrade urban living conditions. Ni Hong, the minister of Housing and Urban-Rural Development, announced a plan to renovate an additional 1 million homes in urban villages and dilapidated areas.
This program is designed to do more than just improve infrastructure. By providing monetary compensation to affected residents and improving living standards for lower-income families, the government hopes to stimulate new housing demand. The focus is on enhancing the quality of life for residents while also injecting vitality into the property market.
Empowering Local Governments and Adjusting Taxes
Recognizing that housing market conditions vary across the country, the central government is giving local authorities more power to act. Cities can now use special bonds to purchase existing residential properties, a policy that helps them manage local housing supply and demand more effectively.
In addition to this, tax policy changes are being considered. Song Qichao, assistant minister of finance, mentioned that adjustments to the real estate value-added tax could be made. Such a move would lower the financial burden for both developers and homebuyers, making it more affordable to buy and sell homes.
Early Signs of a Rebound in Major Cities
These new measures appear to be having a positive effect, especially in China’s largest cities. Following policy changes in late September, home sales have started to recover in Beijing, Shanghai, Guangzhou, and Shenzhen.
Authorities in these key areas took several steps to encourage buyers, including:
- Cutting mortgage interest rates
- Lowering down payment requirements
- Relaxing restrictions on who can buy a home
The impact is being seen beyond these top-tier cities as well. Over 50 other cities, such as Wuhan and Hangzhou, have adopted similar policies to revive their local markets. Analysts see the recovery in first-tier cities as a potential turning point for the entire nation’s real estate sector.
A Pragmatic Shift in Policy
The current approach marks a significant shift in how China manages its property sector. Instead of pushing for rapid growth at all costs, policymakers are now focused on creating a more stable and sustainable market. This balanced strategy aims to prevent future volatility while ensuring housing remains accessible to citizens.
The table below summarizes the key areas of the government’s stabilization plan.
| Policy Area | Key Action or Measure |
| Financial Support | Expanding “white list” loans to over 4 trillion yuan |
| Urban Development | Renovating 1 million housing units in urban villages |
| Local Flexibility | Allowing cities to buy properties with special bonds |
| Tax Policy | Considering adjustments to real estate value-added tax |
By combining financial support, infrastructure upgrades, and local policy freedom, China’s leaders are taking clear steps to steer the property market toward recovery. This coordinated effort is a top priority for maintaining broader economic growth.
Frequently Asked Questions
What is China’s “white list” mechanism for real estate?
The “white list” is a program designed to identify real estate projects that are financially viable but need funding. Banks are encouraged to provide loans to these approved projects to ensure their completion and help stabilize the market.
Why is the Chinese government focusing on housing renovation?
The renovation projects serve two main purposes. They improve living conditions and safety for residents in older areas, and they stimulate economic activity and housing demand by compensating residents and encouraging them to find new homes.
Are these new property policies working?
Early data suggests the measures are having a positive impact. Major cities like Beijing and Shanghai have seen a rebound in home sales after mortgage rates were cut and purchase restrictions were eased.
How are local governments involved in the plan?
Local governments now have more autonomy to address their specific market challenges. They can use special bonds to buy existing homes to balance supply and may implement local subsidies to encourage home purchases.
