Second-hand home transactions in some Chinese cities picked up in July amid easing property curbs – research

 

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Second-hand home sales in some Chinese cities picked up in July from the previous month amid easing property curbs.

The index for second-hand home transaction volume in China’s 50 major cities rose to 40 in July, according to the Beike Research Institute, with more notable growth seen in five cities including Donggan, Langfang, Beijing, Shanghai and Tianjin.

The index was higher than 39 in the same period last year, marking the first year-on-year rise since May 2021, according to Beike. In particular, the index for more than 60% of the cities, including Ningbo, Taiyuan, Nanjing and Suzhou, exceeded the year-ago level.

Separate data from the China Real Estate Information Corporation (CRIC) showed that second-hand home sales by floor area in 15 major Chinese cities amounted to 5.11 million square meters in July, an increase of 3% from the previous month, and the year-over-year drop narrowed to 11%.

In particular, second-hand home sales in the cities of Suzhou in Jiangsu province, Dongguan and Foshan in Guangdong province, Quzhou in Zhejiang province and Baoji in Shaanxi province jumped by more than 10% in July from the month before and sales in Suzhou and Baoji were higher than the year-ago levels, showed the data.

Beike Research said in a report that falling home mortgage rates, lower down payment requirement ratio have further reduced the costs of home purchases, and meanwhile, local governments’ measures to support the housing markets and improving epidemic situation have jointly boosted home transactions last month.

Mainstream home mortgage rates in China’s 103 major cities hit the lowest level since 2019 in July, with more than 70% of the cities’ mortgage rates for first-time homebuyers and second-home buyers hitting the lower limit, according to Beike’s data. Meanwhile, the waiting time for home mortgage loan disbursement at banks has shortened further.

In addition, 49 cities including several provincial capital cities such as Wuhan, Nanchang, Changchun and Harbin have lowered the down payment requirement ratio for first-time homebuyers to the lower limit of 20%.

Since July, about 70 cities have unveiled policy measures to stabilize the housing market, with measures including relaxing home purchase restrictions, increase the maximum of loans homebuyers can borrow from the Housing Provident Fund and offering subsidies, etc.

For in Dongguan which removed home purchase restrictions in some suburb areas, second-hand home transactions in July surged by more than 90% from the previous month to hit the highest since February last year, jumping two times from the year-ago level, according to data from Beike Research.

In Shanghai, Beijing and Tianjin, second-hand home transactions grew by more than 30% on month in July, showed the data.