房地产底部在望

Property Bottom in Sight Chief Economist+852-2203-6139 several indicators suggesting that a durable bottom may be approaching,lasted about as long, and become about as deep, as typical housingdownturns in other economies.What makes the current rebound different, in our view, is that it is not Economist+852-2203-6166 primarily being driven by broad macro stimulus.Instead, it reflectsimproving underlying market dynamics: in key cities, transaction volumesare rising while secondary listings are falling. What we have yet to observeis steady improvement in rents,which could happen this year inlarge cities. gradual, led by top-tier and economically competitive cities rather thanbeingbroad-based nationwide. If theproperty sector does stabilize overthenext 1-2 years, it could help China move from the current narrow, K-shapedconfidence, local government finances, and demand in more traditionalparts of the economy. Where are we in China's property downturn? Three aspects Over the past few months, China's housing market has shown tentative signsTier-2 cities. Shanghai has led the way:transaction volumes have risen markedly,question iswhetherthis reboundmarks thebeginningoftheendof China'spropertydownturn, or merely anotherfalse dawn. We approach this question along three dimensions.First, we benchmarkChina'sdownturnagainstinternationalexperiencehasitrunfarenoughandlongenough?Second,wecomparethecurrentrecoverywiththetwopriorfalsestarts (early 2023 and late 2024) to identify what is different this time. Third, we drawon Hong Kong's recent property recovery to extract lessons for mainland China,particularly its core cities. 1.Thedownturnhasrunitscourse Our earlier work suggests that, across major economies,the median housingdownturn - from peak to trough - lasts roughly five years, with a typical range offour to seven. The median peak-to-trough price decline is around 20%. China's current downcycle, which began when prices peaked in H1 2021, hasjust exceeded the five-yearmark.On duration alone, it is approaching the globalmedian.On the depth of the correction, official statistics pointto a cumulative pricedecline of roughly 14% for new homes and 22% for secondary homes, whileanecdotal measures place the fall closer to 30% in many cities.By either metric,China's downturnhas becomebroadly comparable to international precedents. a housing downturn that stretched across a decade and a half. We think this is thewrong reference point. Japan's "lost decades" began when its global China Macro economies.The past five years in China tell the opposite story:risingcompetitiveness and expanding global market share. This is the most fundamentaldifferencebetweenthetwoeconomies attheonsetoftheirrespectivehousingdownturns. We therefore anchor our analysis to the broader internationalexperience,nottoJapanasabasecase. In both early 2023 (post-reopening)and late 2024 to early 2025, the Chinese property market saw short-lived rebounds in transaction volumes and prices, onlyfor both to fade within a few months. Are we witnessing another false signal? Wethink the current recovery departs from those episodes in two important ways: A different driver.The two prior rebounds were predominantly policy-driven.Bythat,we donot meanonlyproperty-sectorpolicies suchas cutstodown-payment requirements and mortgage rates,as wellas theremovalafteracomprehensivestimuluspackage.Thesepoliciesunleashedaburstofone-off demand, but once thepolicy impulse faded, prices resumedtheirdecline.This time, however,although some property policy adjustments arepresent, we did not see any significant change in broader macroeconomicpolicy. 2.A different feedback loop. Inboth previous rebounds, afamiliar patternplayed out:as soon as transaction volumes picked up,the supply ofsecond-hand listings surged, quickly tipping the supply-demand balanceback and suppressing the nascent recovery. This time, in Tier-1 cities, theopposite is happening-secondary-markettransactionvolumes arerisingeven as the stock of listings is falling. The negative feedback loop that killedthe earlier recoveries has, at least so far, not materialized. This latter point is particularly important. In the five to ten years preceding thedownturn,China'shousingmarketsawenormoustransactionvolumes,asubstantialshareof whichreflectedhouseholdsusingpropertyasasavingsandinvestment vehicle.Once the cycle turned, household portfolio preferences shiftedsharply: owners of investment properties rushed to offload their holdings. Thismeans the current downturn has been not justa process of absorbing new-home China Macro 1 cities may signal that this inventory digestion is approaching its end. 3.Population and rents,notpolicy and ratesHongKong's property recovery can serve asa useful reference point for assessingmainland China's housing sector.Hong Kong's propertymarketbottomed inQ22025and has sincestageda robust recovery:prices areuproughly10% from the trough, transaction volumes are buoyant, and new-h