Home sales see first y/y growth in 17 months
Property demand is finally – finally – back on the mend.
According to the stats bureau’s (NBS) latest data for sector, published Monday:
- In November, home sales by floor space grew 4.6% y/y, a major improvement from October’s 1.3% decline and the 10.6% drop in September.
- By transaction value, sales rose 4.5% y/y, reversing October’s 0.2% drop.
This marks the first positive sales print since May 2023 – and is an encouraging sign that the positive momentum in October has taken further hold.
ICYMI: A fresh package of property support measures, introduced in late September, fueled a sales rebound across China’s biggest cities.
- In November, authorities rolled out additional homebuying incentives to further the momentum, including tax relief for homebuyers.
Alas, the recent sales uptick has yet to reverse the sector’s overall downturn.
- New property investment fell 11.6% y/y in November, a marginal improvement from October’s 12.3% fall.
- New construction starts – a key measure of developer sentiment and financial health – fell 26.8% y/y, in line with October’s 26.7% decline.
Get smart: We’ve previously noted that a massive inventory overhang is limiting developers’ appetite for new projects.
- As such, it will take several more months of sustained sales recovery before the momentum spills over into investment and construction activity.
Reality check: Even with an eventual housing market recovery, long-term housing demand will remain permanently below its previous peak, forcing developers to operate at a smaller scale.
