The era of "strong demand" in China's housing market is over, with "imbalanced and inadequate" development becoming the industry's top problem, said Yu Liang, chairman of property developer Vanke Group.
Yu made the remarks on Tuesday during a press briefing in Shenzhen, South China's Guangdong Province to explain Vanke's 2017 performance, which was announced on Monday.
Vanke said revenue in 2017 reached 242.9 billion yuan ($38.5 billion), up by 1 percent year-on-year. Net profit reached 28.1 billion yuan, with a yearly increase of 33.4 percent, the company said at the conference.
"In the past 20 years, the unprecedented wave of urbanization in China generated strong demand for commercial residential houses. So we built a lot in a bid to meet that demand," Yu said.
"But things have changed. Many urban housing units have been sold but lie vacant; meanwhile, young newcomers may lack decent housing. This represents the 'imbalanced' and 'inadequate' supply problems in the sector," Yu said.
According to Yu, these emerging problems have driven Vanke to shift its market strategy in 2018. The company will expand its rental businesses in urban and rural areas, as well as develop support services and facilities associated with those units, to ensure that "everyone can have a place to live".
Yu pointed out as an economy matures, housing-related support services such as community facilities, property management or elder care services would be valued much more.
Song Ding, a research fellow at the China Development Institute, told the Global Times on Tuesday that Yu's comment reflected the policy of curbing speculation and other regulatory policies in the industry promoted by the Chinese government in the past year.
Song said Vanke's plans showed in a practical manner that "houses are for people to live instead of investment or other purposes," which will promote a sounder, more balanced real estate market in the long term.
Other Chinese real estate developers are also making similar strategy shifts.
For example, Country Garden said that 3,000 long-term property leasing apartments have already under construction in major Chinese cities in 2017.
Sunac, another property developer, is seeking for an expansion of its businesses. The company bought 91 percent of 13 tourism projects in July from conglomerate Dalian Wanda Group for $6.5 billion, according to Reuters.