Average prices of new homes across 100 Chinese cities rose in January, while declines in the resale market eased, suggesting early signs of stabilisation after years of turmoil in the country’s vast property sector. The improvement followed renewed government pledges to support the market, according to a private survey released on Sunday.
New home prices increased by 0.18% month on month in January, slowing slightly from a 0.28% rise in December, data from the China Index Academy showed. The research firm said the uptick was driven largely by activity in major cities, where developers launched higher-end, upgraded housing projects that lifted both monthly and annual prices.
First- and second-tier cities such as Chengdu, Shanghai and Hangzhou recorded stronger price momentum as demand concentrated around premium developments and better-located projects. In contrast, third- and fourth-tier cities continued to grapple with excess supply, with prices declining on both a monthly and year-on-year basis as local markets worked through existing inventories.
Conditions in the secondary, or resale, market also showed modest improvement. Prices there fell 0.85% from the previous month, a narrower decline than the 0.97% drop recorded in December, indicating that selling pressure may be easing after prolonged weakness.
China’s property sector has been under strain since tighter regulations introduced in 2021 triggered a liquidity crunch among developers, many of whom later defaulted on debt. The crisis has weighed heavily on economic growth, household confidence and local government finances.
Recent policy signals suggest a shift toward easing. Local media have reported that developers are no longer required to submit monthly data under the so-called “three red lines” policy, widely seen as a key trigger of the debt crisis, pointing to a quiet retreat from some of the most restrictive measures.
On January 1, Qiushi, the Communist Party’s official journal, described the sector as undergoing a “profound adjustment” and urged policymakers to shorten the adjustment period, smooth market volatility and deliver support in a more coordinated manner rather than through piecemeal steps.
Looking ahead, the China Index Academy said sales are likely to soften in February due to the Spring Festival holiday. However, it expects demand to rebound in March as high-quality land in core cities is released and developers intensify promotional efforts ahead of the traditional peak selling season.
