After a year of ups and downs in China's real estate market, the China Index Research Institute released the "China Real Estate Market 2023 Summary & 2024 Outlook" report on December 7, revealing the market trends for us in the coming year. According to the report, the national real estate market will face downward pressure on the scale of sales in 2024, and the area of new construction and development investment may continue to fall. Based on an in-depth analysis of market data and policy trends, we will interpret this report for you in detail, taking you through the changes in China's real estate market.
1. Market sales: the downward pressure on the scale increases.
The report shows that under the premise of maintaining the current macroeconomic policy and real estate regulation policy, under the neutral scenario, the sales area of commercial housing in the country may decline by 4% year-on-year in 20249%, reaching about 1.1 billion square meters. This means that the scale of sales in the real estate market will continue to shrink, putting huge pressure on developers and investors. Under the downward pressure of sales, in order to speed up the return of funds, real estate companies may increase the price reduction of new housing projects, and the overall performance of new housing is expected to be weak.
2. New construction area and development investment: may continue to decline.
In the context of downward pressure on the scale of market sales, the area of new construction and development investment may also continue to fall. This will have a negative impact on the financial situation of developers and the investment climate of the real estate market as a whole. The reduction in the area of new construction may lead to a decline in the number of houses in the coming period, and the decline in development investment will also limit the development momentum of the market.
3. Policy regulation and control: far-reaching impact on the market.
The report pointed out that under the premise of meeting the assumptions and not exceeding the expected events, under the optimistic scenario, the macro economy will continue to recover in 2024, residents' willingness to buy homes will improve, and the transformation of urban villages will be carried out as scheduled, and the sales area of commercial housing in the country may achieve a slight increase, with an absolute scale of slightly more than 1.2 billion square meters. However, it is worth noting that 2024 is the year of the start of the transformation of urban villages in megacities, and although the actual pull on housing demand is limited, it is crucial for the expected impact. This shows that the stimulating effect of policy regulation on the market cannot be ignored.
Fourth, different types of cities: new home sales are obviously different.
For new home sales in different types of cities, the sales area of new homes in first-tier cities may continue to increase slightly, the market in second-tier cities is expected to stabilize at the bottom, and the scale of new home sales in third- and fourth-tier cities is expected to continue to decline. This reflects the differences in economic development, population mobility, and infrastructure development between different cities. Therefore, the policy regulation for different types of cities also needs to be different to achieve more precise results.
5. Housing price trend: short-term **, long-term stability.
The report pointed out that in the short term, the number of second-hand housing listings may still be at a high level, and the demand is weak, and the trend is expected to continue. With the second-hand housing *** more housing demand may turn to the second-hand housing market, in order to speed up the return of funds, real estate companies may increase the price reduction of new housing projects, it is expected that the overall performance of new houses will be weak, but over time housing prices will gradually stabilize.
6. Investment perspective: Multiple factors affect the amount of real estate investment.
The report pointed out that on the one hand, factors such as the decline in new construction starts and the peak construction may continue to restrict investment in construction projects, and the shrinkage of land transactions in the past two years has not changed, which may lead to a further decline in land purchase fees. Under the neutral scenario, real estate development investment in 2024 is likely to decline by about 6% year-on-year. In an optimistic scenario, the promotion of urban village renovation and affordable housing construction may make real estate development investment basically the same as in 2023. This indicates that developers' willingness to invest may decline, and the policy regulation and changes in the market environment will have an impact on investment.
Summary: In the face of a complex and changeable market environment, we need to maintain calm, rational analysis and take scientific and effective policy measures to ensure the stability and healthy development of the market. In this process, the report of the China Index Research Institute provides us with a valuable reference, let us look forward to a more stable development trend of China's real estate market in 2024!
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