Chinese government rushes to shore up struggling property sector with new policies

A report has said China’s housing market ‘remains the primary risk’ as government departments bring in more moves to aid the sector

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China’s property market is still struggling as various policies are tested to try to stabilise the sector which is vital to the economy. Photo: AFP

Published: 10:00am, 16 Jun 2024

More steps are being taken to stabilise China’s property market as various government departments implement policies to help the struggling sector, which remains both a major driver of the Chinese economy, and a major risk to it.

The latest moves made over the past week include an official notice to upgrade old communities, which is expected to optimise land use and drive construction, and a meeting by the central bank to fast-forward the refinancing of low-income housing, in an attempt to absorb inventory.

But while Beijing’s efforts to accelerate the clearance of excess inventory and shore up the property market, which accounted for a quarter of the country’s economic growth at its peak, have gathered pace, analysts have cautioned that the weak sentiment still persists.

On Wednesday, the People’s Bank of China held a meeting in the northeastern province of Shandong, which focused on speeding up the progress of refinancing low-income housing, according to an official statement.

“[The measure] responds to the national policy of consuming housing units in the inventory, optimising the efficiency of the housing market and pushing forward a new development model for the property sector,” the statement said.

Jinan in Shandong province, Tianjin, Chongqing and Zhengzhou city in Henan province all shared their experiences at the meeting after being involved in pilot programmes.

Then on Thursday, the Ministry of Natural Resources issued an official notice on renewing old communities by referencing the experiences of Beijing, Shanghai, Guangzhou and Nanjing.