Shenzhen Officials Rarely Speak Out on Housing Market During National Day: Can This Sales Boom Continue? (AI Translation)

深圳官方罕见为国庆楼市发声 此轮热销行情能否持续？

[para. 1][para. 2][para. 3] Ahead of China’s National Day holiday, the government introduced measures to rejuvenate the real estate market. These policies quickly impacted, as reflected in the increased property market activity across various regions during the holiday period. Shenzhen witnessed a notable uptick in transactions, with new home subscriptions reaching 1,841 units, marking a remarkable 664.14% year-on-year increase. Similarly, the second-hand housing segment saw substantial activity, with 1,314 transactions, indicating a rise in market confidence and a stabilization of housing prices following a decline since 2021.

[para. 4][para. 5][para. 6] The encouragement to stabilize the real estate sector was first remarked upon during a Political Bureau meeting of the CPC Central Committee held on September 26, which led to the easing of housing market restrictions in major cities like Shenzhen, where restrictions on the sales of commercial residences and serviced apartments were lifted. This shift in policy sparked a surge in property sales, with developers noting substantial transactions during the holiday. For instance, a property company in Shenzhen recorded a total of 250 transactions during the National Day holiday, compared to significantly lower figures in previous months.

[para. 7] The real estate market in other first-tier cities such as Beijing, Shanghai, and Guangzhou also experienced a similar increase in activity. According to a survey by the China Index Academy, the subscription volume for new housing projects in Beijing was equivalent to the entire month of September, whereas in Guangzhou, it was 2.2 times that of September. The increased viewing and transaction volumes for second-hand homes have generally been noted across these cities, indicating a broader revival driven by policy changes.

[para. 8][para. 9] In contrast, lower-tier cities have struggled with persistently sluggish real estate sales over the past three years. During the National Day holiday, second- and third-tier cities saw a minor recovery, partially attributed to shorter-term purchasing incentives. For instance, an executive noted that during the holiday, daily sales approached ten units—an amount usually sold over a month—indicating the effects of the holidays and policy interventions on boosting sales.

[para. 10][para. 11][para. 12] Despite these short-term gains, challenges remain. Real estate professionals noted that the conversion rate from customer visits to actual purchases was not substantially high, with most sales stemming from prior interested parties. While the conversion rate for existing clients improved, newly acquired clients' rates remained low. A real estate marketer attributed recent sales growth to policy-driven initiatives, raising concerns about sustainability if the fundamental issues such as income and employment expectations remain unresolved.

[para. 13] Observers are skeptical about the sustained resurgence of housing demand once current interests are absorbed. Acknowledging the macroeconomic challenges, the leaders of real estate companies expressed concerns over the sustainability of the current positive market trend. They remain wary of the broader economic environment affecting demand and are uncertain whether increased sales can last without further favorable policy measures or significant economic changes to boost the housing market independently. An executive from a Shenzhen brokerage firm underscored the prevailing caution among market participants and the need for continuous supportive policies to maintain momentum.