On June 17, the one-month anniversary of the "May 17" new property policies, the National Bureau of Statistics released the changes in commercial residential sales prices in 70 large and medium-sized cities for May and the basic situation of the national real estate market from January to May. New home prices in Shanghai, Xi'an, and Chengdu rose year-on-year. After the new policies, second-hand home transactions were active in multiple cities, and under the strategy of "trading price for volume," home prices in many cities showed slight declines.

Liu Aihua, spokesperson for the National Bureau of Statistics, said at the press conference that since mid-May, relevant departments and regions have further adjusted and optimized real estate policies, and some positive changes have emerged in the real estate market.

From January to May, national real estate development investment was 4,063.2 billion yuan, down 10.1% year-on-year (calculated on a comparable basis), and national sales of newly built commercial housing totaled 3,566.5 billion yuan.

Wang Zhonghua, chief statistician of the Urban Department of the National Bureau of Statistics, noted in interpreting the data that in May, sales prices of commercial residential properties in cities of all tiers declined month-on-month. In first-tier cities, new home sales prices fell 0.7% month-on-month, with Shanghai up 0.6%, while Beijing, Guangzhou, and Shenzhen fell 1.1%, 1.4%, and 0.8%, respectively. In second- and third-tier cities, new commercial residential sales prices fell 0.7% and 0.8% month-on-month, respectively.

　　Shanghai new home prices up 4.5% year-on-year

Chen Wenjing, market research director of the China Index Academy, told the Daily Economic News reporter: "The regulatory authorities' 'package' of new policies has been implemented, lowering the down payment ratio, canceling the lower limit on mortgage rates, and at the same time proposing destocking measures. Most cities across the country subsequently followed up and implemented the relevant policies, driving up home-buying sentiment. In terms of policy effects, at the national level, the year-on-year decline in commercial housing sales from January to May narrowed, and in May alone, both the year-on-year decline in commercial housing sales area and sales value narrowed, and the market showed signs of marginal improvement."

Among first-tier cities, in May, Shanghai new home prices rose 4.5% year-on-year, leading the 70 cities in both year-on-year and month-on-month increases; Beijing, Guangzhou, and Shenzhen fell 1.8%, 8.3%, and 7.4%, respectively. In addition, Shanghai and Taiyuan were also among the 70 cities that still maintained month-on-month home price increases.

Yan Yuejin, research director of the E-House Research Institute, believes that Shanghai has played a demonstration role in this round of housing market recovery, and localities should make efforts in repairing urban fundamentals and continuously tap potential market demand.

New home prices in second- and third-tier cities fell 3.7% and 4.9% year-on-year, respectively. It is worth noting that differentiation among cities is obvious: Xi'an rose 3.8% year-on-year and Chengdu edged up 0.2% year-on-year, with their popularity still undiminished. Some second- and third-tier cities that previously saw relatively high home price increases, such as Nanjing, Jinhua, and Xiamen, had year-on-year declines exceeding or approaching 8%.

Zhang Bo, president of the 58 Anjuke Research Institute, said of this: "From the data, home prices in the 70 cities were still in a consolidation phase in May, and the new policies' boost to demand-side confidence was more evident in hotspot first- and second-tier cities. Combined with Anjuke's online data, the overall online home-search heat for new homes in 65 key cities nationwide rebounded by 5%, with heat rising in 50 of the 65 cities. On the demand side, lower down payments combined with across-the-board cuts in housing provident fund rates and commercial loan rates have effectively lowered the threshold for buying homes, which will have a substantive impact on subsequent homebuyers actively entering the market, help energize the real estate sales market, and promote market recovery."

The second-hand home market has been more characterized by "trading price for volume." Second-hand home prices in the 70 cities fell both year-on-year and month-on-month, with cities such as Xuzhou, Xiamen, Guangzhou, Wuhan, Nanjing, and Wenzhou seeing year-on-year declines of more than 10%. Hotspot cities such as Sanya, Kunming, and Xi'an also showed obvious year-on-year declines.

However, the effects after the policies were gradually implemented were more reflected after the end of May.

According to the China Index Academy, in the first two weeks of June (i.e., May 27 to June 9), the average weekly transaction area of new homes in 50 key cities increased by 24% compared with May and fell 22.3% compared with the same period last year. Affected by the lower base last year, the year-on-year decline continued to narrow compared with May. The second-hand home market maintained relatively high activity. In the second week of June (June 3 to June 9), second-hand home transaction volume in 11 key cities grew year-on-year for three consecutive weeks, with obvious policy effects in cities such as Shanghai, Shenzhen, and Hangzhou. For example, after the May 27 new policies, Shanghai's second-hand home transaction volume exceeded 900 units on multiple days, and online signing reached 1,059 units on June 14, the first time this year that single-day online signing exceeded 1,000 units. In Shenzhen, from June 1 to 14, the average daily number of new home transactions increased by 13.9% compared with May; since June, the average daily transaction volume has been basically flat with May and, on a low base, up 57.4% year-on-year.

　　Declines in investment and development data narrow

Data from the National Bureau of Statistics show that from January to May, national real estate development investment was 4,063.2 billion yuan, down 10.1% year-on-year (calculated on a comparable basis), of which residential investment was 3,082.4 billion yuan, down 10.6%. The sales area of newly built commercial housing was 366.42 million square meters, down 20.3% year-on-year, of which residential sales area fell 23.6%. Sales of newly built commercial housing totaled 3,566.5 billion yuan, down 27.9%, of which residential sales fell 30.5%.

At the end of May, the area of commercial housing for sale nationwide was 742.56 million square meters, up 15.8% year-on-year. At the same time, various supply-side data were also shrinking in tandem: from January to May, the floor space under construction by real estate development enterprises was 6,888.96 million square meters, down 11.6% year-on-year, of which residential floor space under construction was 4,815.57 million square meters, down 12.2%.

Funds available to real estate development enterprises remained at a low level, totaling 4,257.1 billion yuan in the first five months, down 24.3% year-on-year.

In this regard, Chen Wenjing analyzed: "In May, downward pressure on real estate development investment remained relatively large, and it still takes time for marginal demand-side improvement to be transmitted to the investment side. Driven by policies, the decline in funds available to real estate development enterprises also narrowed. According to China Index monitoring, the scale of bond issuance by private real estate enterprises rose slightly for three consecutive months in May. After the implementation of multiple policy measures, real estate market sentiment has improved somewhat, especially as policy effects in core cities are becoming apparent. On June 12, the central bank held a meeting to promote the work of relending for affordable housing, striving to promote the implementation and effectiveness of the relending policy for affordable housing and accelerate the destocking of existing commercial housing. In the short term, localities are expected to accelerate the implementation of destocking measures, which will help provide more funding support to enterprises, help them overcome difficulties, and further help improve real estate development investment marginally."