In 2024, real estate policy will be "played" frequently 760 times. Next year, urban reform, property acquisition and storage may play a key role in promoting the stabilization of the property market.

The real estate market in 2024 is still in a deep adjustment process, with stabilization after a decline becoming the keyword in the current and future market under strong policy support. Analysts say that from loosening restrictive policies to implementing stimulating policies, the measures in the 2024 real estate market have been almost fully utilized: from mortgage rates to transaction taxes and fees, from down payments to adjustments in supply and demand, every policy adjustment affects buyers, real estate companies, and the entire real estate market. According to data from the China Index Institute, as of now, various regions in the country have implemented real estate control policies more than 760 times in 2024. The current policy environment is at its most lenient level in history, especially in terms of demand-side policies, involving the cost of home purchases for residents, mortgage rates, transaction taxes and fees, down payments, which have all reached historical lows. With a series of policy supports, the market saw a phase of stabilization in the fourth quarter. In this market environment, where will the real estate market go in 2025, how will policies be strengthened, will the accommodative approach continue or will there be moderate adjustments? "At a work conference held by the Ministry of Housing and Urban-Rural Development in Beijing, the direction for real estate development for the next three years has been determined," said Yang Fan, a Zheshang real estate analyst, told reporters. In order to achieve the goal of "stabilizing after a decline" in 2025, the current stage of policies is expected to continue to be accommodative, especially measures related to fiscal policy, which may be further intensified. Yuan Hao, an analyst at Shenwan Hongyuan Group, expects mortgage rates to continue to decline in 2025, including commercial loans and provident fund loans; it is also expected that first-tier cities will continue to optimize purchase restrictions and tax policies; efforts to purchase and store inventory are expected to accelerate; there is also room for optimization in mortgage policies. The policy environment has reached its most lenient level in history: The intensity and frequency of real estate policies in 2024 are unprecedented, and the policy environment has reached its most lenient stage in history. "After a brief period of optimism at the beginning of the year, the market rapidly declined, especially with significant price reductions in the second-hand housing market, leading to a phase of declining volume and price cycles that exceeded expectations at the time," said Li Yujia, chief researcher at the Guangdong Housing Policy Research Center. Against this backdrop, a major adjustment cycle began in 2024. Various ministries successively issued a series of policies throughout the year, with a total of 60 basis point cuts in interest rates, a 100 basis point cut in reserve requirements, while the average drop in existing housing loans is expected to be 50 basis points. Purchase restrictions were almost completely lifted, and restrictive policies were almost entirely canceled, following the September 2024 Political Bureau meeting, which proposed "stabilizing after a decline," leading to rapid implementation of tax and fee optimizations, with strong fiscal policy support for inventory acquisition and repurchase of idle land. "Compared to history, the intensity of this round of policies is no less than in previous years," said Liu Qinghai, an analyst at Founder. Specifically, the policy thrust in 2024 can be roughly divided into three stages. Before May 17, the focus was still on the central bank lowering the loan prime rate, such as a 25 basis point reduction at the beginning of the year, with local governments, especially first-tier cities, collectively relaxing purchase restrictions and lowering down payment ratios for first and second homes. "In the first half of 2024, there were no significant substantive stimuli; adjustments were mainly aimed at optimizing existing systems, with the aim of regulating market order, improving new models for real estate industry development, with policy action limited to small changes," according to analysts at Ke Rui. The "New Policy on May 17" marked the beginning of a shift in policies, with regulatory agencies beginning to implement more powerful new policies. On May 17, the central bank lowered the down payment ratio for first and second homes, removed the national lower limit on mortgage rates, and lowered the interest rate on provident fund loans. In terms of de-stocking, on the same day, the central bank set up 300 billion yuan for re-lending for the purchase of existing commercial housing, while the Ministry of Housing and Urban-Rural Development and the Ministry of Natural Resources proposed measures to revitalize idle land and support local land recovery. In June, the Ministry of Natural Resources and the National Development and Reform Commission issued a document with 18 measures in three areas to deal with idle land stocks. After May 17, the pace of policy advancement accelerated, but the sales market continued to fluctuate. After the first round of policy efficacy weakened at the end of August, a new round of favorable policies was quickly announced in September. Subsequently, "September 26" became a turning point for the industry, with a new direction appearing. On September 26, the Political Bureau meeting established the goal of "promoting a stabilization in the real estate market," marking the first time such a statement was made at the central level, while also introducing a package of incremental policies, with departmental policies continuing to be strengthened, forming a combination of policies. Subsequently, several ministries rolled out a series of measures to stabilize the real estate market, outlining the "four cancellations, four reductions, and two increases" to promote stability in the real estate market, including lowering interest rates, lowering the lower limit of down payments for second homes, and reducing the interest rates on existing housing loans, with both first-home and second-home mortgage rates dropping to historic lows of 15%. In addition, on October 12, the Ministry of Finance allowed the use of special bond funds and subsidized housing funds for the purchase of existing housing, and enabled the use of special bonds for the recovery of idle land. On November 13, the Ministry of Finance and other departments jointly issued tax optimization policies, reducing the tax burden on homebuyers and businesses; on November 15, the Ministry of Housing and Urban-Rural Development and the Ministry of Finance issued a document deploying further work on urban village transformation, expanding the number of cities undergoing urban village transformations and promoting monetized resettlement. At the local level, since 2024, the intensity of policy adjustments in various regions has further increased, with comprehensive optimization of policies, and most cities have fully lifted restrictive policies introduced during the overheated market phase, while also releasing policy incentives in terms of increased housing subsidies and higher provident fund loan quotas. "As of now, except for a few core cities that still have certain restrictive policies in place, most cities nationwide have completely lifted purchase restrictions, and the current policy environment is at its historically most lenient level," analysts at the China Index Institute said. After continued policy efforts, signs of stabilization have appeared in the market. On December 25, the Ministry of Housing and Urban-Rural Development meeting pointed out that the real estate market has shown positive changes, and in October and November, the real estate market showed signs of stabilization after a decline. According to data from the China Index Institute, since December (1st to 22nd), the transaction volume of new homes in the top 30 cities has increased by more than 10% month-on-month and year-on-year, as has the transaction volume of second-hand homes in the top 20 cities. Some analysts pointed out that policies are constantly testing the market's sensitive points in order to find the best balance point to promote the healthy and sustainable development of the real estate market. The coordinated adjustments in various aspects of policies in 2024 are not only aimed at short-term market heating, but also from a long-term perspective.Consider building a more rational and stable real estate market ecosystem, so that real estate can return to its residential attributes while also playing its due role in the economic field."Urban renovation" and "land acquisition and storage" policies may become key factors As the policy environment enters the most relaxed stage in history by 2025, the development of real estate policies in 2025 has attracted much attention. Many analysts point out that looking ahead to 2025, real estate market policies are expected to continue to be optimized and improved on the existing loose foundation, steadily moving towards the establishment of a long-term mechanism. In fact, the meetings of the Politburo and the Economic Work Conference at the end of the year have pointed out the direction for the development of the real estate market in 2025. On December 9th, the Politburo meeting set the tone for "stabilizing the housing market"; on December 12th, the Economic Work Conference once again emphasized "continuing efforts to push the real estate market to stabilize"; on December 25th, the housing construction work meeting set the tone for the development direction of the real estate market in 2025, with stabilizing the market as the top priority. Analysts point out that in the current market environment, although some cities have shown signs of stabilizing, the overall market uncertainty remains high, with issues such as market-anticipated volatility and increasing differentiation between cities still existing. Therefore, maintaining policy continuity and stability is crucial. Therefore, looking ahead to 2025, the loose tone of real estate policies may continue, and the next stage of policies is expected to continue to focus on "stimulating demand" and "optimizing supply." "It is expected that in 2025, efforts will be made in the implementation of policies that have been introduced, such as further lowering mortgage rates, continuing to reduce existing housing loans, fully lifting restrictive measures on home purchases (in cities like Beijing, Shanghai, Shenzhen, and Hainan), and gradually restoring the normal operating capacity of enterprises, such as acquiring idle land from real estate companies and acquiring existing commodity housing for affordable housing, taking multiple measures to gradually improve the imbalance between market supply and demand leading to expected price declines." Analysts from Ke Rui said. Yuan Hao believes that among the subsequent policy spaces, urban renovation and land acquisition and storage are the most crucial policies. On the one hand, both urban renovation and land acquisition and storage play important roles in repairing residents' balance sheets, especially urban renovation; on the other hand, urban renovation is a demand-side stimulus measure, while land acquisition and storage are more like a stabilization fund on the supply side. Adjusting demand and supply separately in terms of timing can to a certain extent smooth out the real estate cycle and achieve a long-term mechanism for real estate. Analysts from securities institutions believe that the construction of a long-term mechanism is the core direction of future real estate policies, which requires comprehensive consideration of factors such as population, land, finance, etc., and continuous policy optimization and adjustment are essential. It is expected that in 2025, more policy measures focusing on this goal will be introduced, guiding the real estate market to transition from scale expansion to high-quality development, and achieve stable, healthy, and sustainable development of the industry. Many analysts believe that the real estate policies in 2024 have already created a good loose environment for the market, and the policy direction in 2025 will continue to focus on stabilizing the market, ensuring people's livelihood, promoting development, and constantly exploring innovations to push the real estate industry towards a new phase. This article is reprinted from "Cailian Press", GMTEight Editor: Liu Xuan.