The market of the property market is moving toward the future

According to recent figures, in the first half of November, the number of signed contracts for newly constructed residential properties in Beijing reached 3,911 units, averaging 391 units per day. This represents a 23.6% increase compared to the daily average of new home sales in October and suggests signs of undersupply in the market. However, in third and fourth-tier cities, the real estate inventory might have suffered significant losses due to declining prices. Notably, Wenzhou has led the nationwide decline in housing prices for two consecutive months starting from September. Guo Yi, director of institutional marketing at Yahao, explained that regional differences in economic development levels, customer demographics, and reliance on the real estate sector contribute to these disparities. First-tier cities like Beijing attract buyers from across the globe, whereas third-tier and fourth-tier cities primarily rely on local consumers. Zhang Dawei, head of the Central Plains Real Estate Market Research Department, expressed skepticism over these numbers. He noted that many reports focus solely on the inventory pressures faced by specific cities. While there is indeed a divide between large urban centers and smaller municipalities, this gap isn’t static. From a broader market perspective, both types of cities have emerged from their troughs, though their recovery trajectories differ. Besides Wenzhou and other southeastern coastal areas, few cities have experienced significant price drops. Housing prices in most third-tier and fourth-tier cities have seen only minor declines, which are smaller than those observed earlier this year. However, it’s misleading to compare the current heat in first-tier cities with the relative coolness in smaller ones. Given these stark contrasts in the real estate landscape, the industry remains divided over the state of China's property market. Opinions also vary regarding its future trajectory. "The upward trend in housing prices in first-tier cities is inevitable," stated Guo Yi. For the real estate sector, value is determined by the resources it can harness. The more resources available, the higher the value. Third-tier and fourth-tier cities often lack comparable business opportunities, healthcare services, or educational facilities when compared to first-tier cities. Therefore, China's real estate market is likely to see this dualistic growth persist for some time." Despite the ongoing polarization, policies aimed at ensuring affordable housing could help moderate price increases. Since 2009, approximately 21 million units of subsidized housing have been constructed nationwide, with around 11 million already completed. Coverage of affordable housing has risen from under 4% in 2008 to 11%. Zhou Biwen, director of the Beijing Institute of Technology's Real Estate Research Center, predicts a stable trend moving forward. Prices won’t skyrocket, but neither should we expect a downturn. This stability aligns with healthy market development.