Growth spurs mild China property uptrend(2)

"As the real estate industrial chain is gradually gaining momentum, the industry is expected to form a virtuous circle step by step, and guide market expectation, confidence and capital in the positive direction," Yao said.

Agreed Shaun Brodie, senior director and head of occupier research of China at Cushman &Wakefield, a global real estate services firm. "This year, with a good start to China's economic growth, the real estate market in China has recovered and stabilized in terms of a number of key indicators. Ahead, however, there is still further policy work to be done to ensure market stabilization remains a long-term phenomenon."

Industry experts agreed the way ahead may see ups and downs as the market pursues an overall recovery.

After the early spring recovery in the first quarter, major Chinese cities saw a universal retreat in realty deals in April as the supply of newly built houses reached a five-year low across the 30 key cities tracked by China Real Estate Information Corp, or CRIC, a unit of E-House (China) Enterprise Holdings Ltd.

At the same time, trade volume in April declined by 27 percent month-on-month, said Yang Kewei, vice-general manager of CRIC's research center.

"Although home transactions in April rose by 37 percent year-on-year, the figure remained lower than the levels seen between 2019 and 2021, because of the low comparison base of last year, when the pandemic eroded market performance. This shows the market recovery still needs more steam," said Yang.

The bump in the home market in April indicated that market confidence is yet to recover fully, and the digest of the accumulated inelastic demand in the previous months led to a market slowdown, Yang said.

Li Guo, 32, a white-collar professional working for a construction company and a prospective homebuyer, understands the current market situation. He and his wife bought a three-bedroom apartment in 2015 in one of the suburban areas of Hangzhou, Zhejiang province. Since their only child is about to enter primary school in September, the Lis are considering to sell their existing home for a smaller one located in downtown area that is known to be home to better schools.

"But the uncertainties of the home market make it very hard for us to figure out the right timing for selling and then buying," Li said.

With regard to such unstable demand recovery, Xie said he expects more easing in measures in the coming months targeted at supporting inelastic and improving demand, ensuring timely home deliveries and stabilizing the market.

Experts said the Political Bureau of the Communist Party of China Central Committee meeting held on April 28 laid a solid policy foundation for market stabilization in the second half of the year.

The meeting highlighted the stable and healthy development of the real estate market, the establishment of a new development model for the real estate industry, the need to meet demand for homes for living (not for speculation purposes), market stabilization, raising people's life quality, urbanization, and green and high-quality development, said Yao with JLL.

Property developers will come up with quality products and services via adoption of various methodologies, and at the same time keep an eye on risk prevention, cost control and productivity enhancement. Local governments are tending to launch measures to address their specific situation, and striving to ensure the effective execution of central government policies, said Yao.