City building in the city of Huai'an, province of Jiangsu, China, on March 18, 2025.
CFOTO | Future publication | Getty pictures
Beijing – UBS -Analysts On Wednesday, the last expectations were that China's fighting real estate market is about to stabilize.
“After four or five years of a down cycle, we started to see some relatively positive signals,” John Lam, head of the Asian-Pacific property and Greater China real estate research at UBS Investment Bank, told reporters on Wednesday. This is after a CNBC translation of his mandarin-language remarks.
“Of course, these signals are not nationwide and may be local,” said Lam. “But it should be more positive compared to the past.”
An indicator is to improve sales in China's largest cities.
The existing sales for homes in five large Chinese cities rose by more than 30%from the previous year to Wednesday. This emerges from the CNBC analysis of data that is accessed via diaper information. In contrast to the primary market, the category is usually referred to as “secondary home sales”, which usually consisted of newly built dormitories.
UBS now predicts that China's real estate prices can stabilize in early 2026, formerly than the previously predicted time frame in mid -2026. You expect secondary transactions to reach half of the total amount by 2026.
UBS examined four factors – a low inventory, an increasing premium at land prices, rising secondary sales and rising rental prices – which had given a turning point for the real estate market between 2014 and 2015. From February 2025, only the rental prices still had to find an improvement, the company said.
In September, the Chinese political decision -makers called for a “stop” in the decline of the real estate sector, which is the most part of the budgetary assets and contributed to more than a quarter of the economy just a few years earlier. Large developers such as Evergrande have excluded their debts, while the sales of real estate since 2021 last year, according to S&P Global Ratings, has almost been halved last year.
The Chinese real estate market began its latest decline in late 2020 after Beijing had started to impair the high dependence on developers in growth debt. Despite a flood of measures by the central and local government in the past few years and a half, the real estate collapse has existed.
After a more powerful incentive was announced at the end of last year, the analysts began to predict that a low could come until later this year.
Already in January, the S&P Global Ratings confirmed his view that China's real estate market would stabilize in the second half of 2025. The analysts expected “rising secondary sales” to be a guiding indicator for primary sales.
Then, at the end of February, Macquaries Chief China economist Larry HU on three “positive” signals that could support a low point of real estate prices this year. He found that in addition to the guideline boost, the unmounted housing stock has dropped to the lowest since 2011 and that a narrowed gap between mortgage interests and tenant income could encourage home buyers to buy more than rent.
In an e -mail this week, however, he said that what China's real estate market still needs is financial support from the central bank.
Michelle Kwok from HSBC from Asia in February said there are “10 signs” that the Chinese real estate market went deeply. The list included the recovery of sales for new homes, real estate prices and the participation of foreign investments.
In addition to state companies, the Foreign Capital “invests in the real estate market”, the report says and found that “two Singapore developers/investment funds were taken over in Shanghai on February 20”.
Foreign investors are also looking for alternative opportunities to enter the Chinese real estate market after Beijing has announced a move for affordable rental apartments.
Investco announced at the end of February that his real estate investment device has formed a joint venture with a ziroom, a Chinese company that is known on site for its standardized rents in the modern apartment.
The joint venture named Izara Holdings is planning to invest 1.2 billion yuan (about $ 160 million) in a rental apartment of 1,500 rooms near one of the locations for the Olympic Winter Games of Beijing with a targeted opening of 2027.
The units will probably be available around 5,000 yuan per month, said Calvin Chou, head of the Asian-Pacific area, Investco Real Estate, in an interview. He said that the developers' financial difficulties have created a gap in the market and he expects the joint venture to invest in at least one or two other projects in China this year.
The Ziroom database enables the company to quickly evaluate regional factors for the selection of new developments, said Meng Yue, CEO of Ziroom Asset Management, in a statement and added the venture plans to finally expand to overseas.
Not out of the forest
However, the data still reflects a fighting real estate market. Real estate investments were still decreasing by almost 10% in the first two months of the year, according to a number of official economic figures published on Monday.
“The real estate sector is particularly worrying because the most important data is in the negative territory. In January to February from -25.5% in the fourth quarter of 2024 in the fourth quarter, it was in the fourth quarter to the negative area. The chief economist from Nomura, Ting Lus, in a report on Monday.
“It has long been a view that there will be no real recovery in the Chinese economy without real stabilization of the real estate sector,” he said.
Improved secondary sales do not benefit from the developers, whose revenue previously came from primary sales. S&P Global Ratings This month Vanke brought Vanke on loan observation and downgraded his rating on Longfor. Both developers were among the largest on the market.
“In general China [recent] The political efforts were quite extensive, “said Sky Kwah, head of the facility at Raffles Family Office, in an interview at the beginning of this month.
“The key at this point is the execution. Restoration The sector is based on the trust of consumers,” he said, adding that “they do not reverse the trust overnight. Self -confidence has to be deserved.”