In recent months, the real estate markets of several cities have begun to show signs of recovery, indicating a positive shift in activity levelsThere has been a noticeable increase in foot traffic to sales offices, alongside a rise in the volume of second-hand home transactionsThis trend suggests an improving sentiment toward the real estate sector, as both potential buyers and investors appear to regain confidenceThe importance of stable expectations cannot be overstated; they provide a crucial foundation for a stable market.

The recent uptick in market activity reflects a renewed confidence among stakeholders in the real estate landscapeThis resurgence is bolstered by the clear indications from the government to foster a healthy and sustainable real estate marketEnsuring the market halts its decline and begins to stabilize sends a powerful message from the authorities about their commitment to restoring balance.

Prior to the National Day holiday, the four tier-one cities—Beijing, Shanghai, Guangzhou, and Shenzhen—amended their policies regarding real estate regulation

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Research by the property consultancy firm CRIC revealed that 22 major cities saw a year-on-year increase of 26% in subscribed area during the holiday period, with a 12% rise compared to the previous monthSpecifically, in Beijing, Shenzhen, and Guangzhou, the total subscribed area rose by an incredible 42% year-on-yearMeanwhile, second- and third-tier cities demonstrated even more robust growth, achieving increases of 23% and 40%, respectivelyNotably, transactions in the second-hand housing market outpaced those of new homes, with the top ten cities recording a remarkable year-on-year increase of 161% in second-hand property transactions, and the tier-one cities witnessing a staggering 262% surge.

Following the holiday, the vibrant activity in the market has persistedThe current period, often referred to as "Silver October," is traditionally a peak sales season, during which over 100 cities have organized promotional events such as autumn sales and real estate exhibitions

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These efforts serve to attract potential homebuyers, reduce purchasing costs, and boost market confidence, proving beneficial to all involved.

The ongoing efforts to ensure housing delivery have played a crucial role in encouraging buyers to return to the new housing marketMany property developers have faced severe cash flow issues, leading to delays in the delivery of homes that had already been sold, which caused considerable anxiety among both buyers and prospective purchasersConcerned about investing in unfinished properties or "phantom" towers, many potential buyers hesitated, opting instead for second-hand homesIn response to this trend, the Ministry of Housing and Urban-Rural Development and the National Financial Regulatory Administration established a collaborative framework for real estate financing earlier this year, aiming to support legitimate project financing needs and aid in the timely completion and handover of properties

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The Ministry has specifically targeted 3.96 million homes as priorities in the effort to ensure successful deliveryThis initiative has yielded significant results, with numerous homeowners finally receiving the keys to their long-awaited homes, alleviating fears for others still on the fence about purchasing new properties.

Looking towards the future, there is substantial support for the sustainable high-quality development of China's real estate sectorThe industry still possesses significant growth potential, primarily due to its crucial role in the economy and government support for policy measures aimed at stabilizing the marketReal estate is not just a cornerstone of the national economy; it also encompasses an extensive industrial chain that can significantly influence economic growth and stabilityThe government continues to prioritize the sector's development, deploying multiple strategies to halt its downward trend, paving the way for a healthy and vibrant real estate market.

The real estate industry maintains the capacity for expansion largely because urbanization in China remains a work in progress

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As of 2023, China's urbanization rate stands at 66.16%, indicating a gap compared to developed economies with rates above 80%. With the urbanization of the registered population still below 50%, a staggering 180 million migrant workers live in cities without completely transitioning to urban citizenshipAmong this demographic, the rate of home ownership is still lowCurrently, the average living space per capita in China is around 41 square metersHowever, the existing housing stock is predominantly comprised of smaller units, with most being under 90 square metersAs living standards rise and urbanization progresses, the market is set to see considerable demand both for improvements and new housing, fuelling the need for better residential options.

Furthermore, the demand for "quality housing" from residents remains a driving forceThere is a growing expectation for enhanced living conditions and environments

Quality housing is characterized as being green, low-carbon, intelligent, and secure, featuring high standards, thoughtful design, superior materials, and excellent construction and serviceNew homes are being developed to meet these standards, while older residences undergo urban renewal to transform them into quality propertiesThe proliferation of such "good homes" not only enhances comfort for residents but also encourages the real estate industry to explore future growth avenues actively, fostering a more vibrant housing market.

Moreover, the potential for new development models in the real estate sector continues to offer immense possibilitiesThese innovative approaches are considered essential to overcoming the challenges faced by the industry and promoting its healthy growthProjects currently underway, such as the construction of affordable housing, the development of dual-purpose public infrastructure, and the transformation of urban villages, are gaining momentum