Wang Shi, Chairman of China Vanke Co., Ltd. (02202.HK), said after the B-to-H share listing ceremony on June 25 that the mainland real estate market is currently undergoing adjustment, but the adjustment is not yet thorough enough. He believes such adjustment is very necessary and that the adjustment period may last 2 to 4 years, or even longer.

“Vanke has a saying that the golden age has ended and we are now in the silver age. In the so-called silver age, making money is not as easy as it was in the golden age,” Wang Shi said.

Wang Shi said that although the market has entered the silver age, the real estate market still exists. It is just that some cities that were previously key development areas, such as Beijing, Shanghai, Guangzhou and Shenzhen, are gradually developing toward mature urban models, which also means these cities will no longer see the rapid expansion of the past. The existing structures of various cities also need further improvement of supporting facilities, just like Hong Kong, Tokyo and Singapore, let alone cities in developed countries.

As for the outlook for China's real estate, Wang Shi believes the current adjustment is very necessary. If housing prices keep rising and prices rise as soon as they are bought, that is actually very bad. If the market does not adjust, the real estate bubble may really burst. If it bursts, the situation would be very bad, as in Japan, and could even be more troublesome than the Japanese market.

At present, China's real estate market as a whole is in adjustment. In fact, it is not just real estate; China's entire economy is adjusting, transitioning from high-speed growth to slower growth. In this transition, real estate bears the brunt. However, Wang Shi believes the market can withstand this adjustment and that there is no need to roll out stimulus policies at the slightest fluctuation in housing prices. This would be more conducive to the healthy development of the market.

Wang Shi also said that the duration of this adjustment cycle is uncertain and may last 2 to 4 years, or even longer, but it is an adjustment toward a healthy direction. In any adjustment and development process, there will be uncertainty and risks. As a listed company, Vanke will also think about how to grasp the direction of market development amid this uncertainty.