China’s Pre-Owned Home Sales Surge in Early 2024, Indicating Potential Property Market Recovery

Analysts foresee a promising turnaround in China’s property market later this year as the pre-owned homes segment displays notable growth in the first two months of 2024. Despite a decline compared to 2023 figures, the sales surge suggests a potential market revival amid ongoing efforts by authorities to relax purchase restrictions.

Data released by the China Index Academy reveals a nearly 25% increase in second-hand home sales across 25 major cities during January and February, compared to the same period in 2022. Although down by 13.1% from 2023 levels, this uptick signals optimism among analysts for a substantial recovery in the coming months.

Yan Yuejin, Director of the E-house China Research and Development Institute, notes the increased activity in the pre-owned homes market, citing a surge in listings as a driving force behind enhanced buyer options and competitive pricing. With sellers becoming more flexible on pricing, the value proposition of pre-owned homes becomes increasingly evident to buyers.

In February, the number of listings in 14 major cities surged by 56.9% year-on-year, marking the 18th consecutive monthly increase. Notably, higher-tier cities like Beijing and Shenzhen witnessed notable spikes in activity, with increased listings and contracted sales indicating growing momentum in the market.

Lindsay Zhang, a Beijing resident, remains cautiously optimistic about purchasing a second-hand flat, anticipating further price drops before making a move. Stimulus measures and policy changes, such as those implemented in Beijing and Hangzhou to ease home-purchase restrictions, are expected to further stimulate demand and market activity.

Amid these efforts, the People’s Bank of China (PBOC) announced a significant 25-basis-point cut to its five-year loan prime rate in February, aimed at incentivizing home buying. PBOC Governor Pan Gongsheng acknowledges “positive signals” in the property sector, hinting at a potential turnaround in the market sentiment.

Despite challenges in the new home market, evidenced by consecutive declines in sales, the surge in pre-owned home sales offers a glimmer of hope for the broader property market’s recovery trajectory. Analysts remain cautiously optimistic, anticipating continued policy support and market revitalization efforts to fuel sustained growth in the coming months.

As China’s property market navigates through challenges, the resurgence in pre-owned home sales underscores resilience and potential for recovery, offering opportunities for both buyers and sellers in the evolving landscape.

Matthew Graham
Matthew Graham
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