Falling sales offer few signs of end to China's property slump
Cumulative sales of China's top 100 property developers from January to May fell 7.1 per cent year-on-year to 1.3 trillion yuan (S$233.2 billion), accelerating from the 6.7 per cent drop for the January-to-April period, according to figures published Saturday by China Real Estate Information Corp (CRIC).
The CRIC report measures sales from projects directly managed by the top 100 developers, excluding projects including those run by external partners.
Figures released by another data provider for the industry, China Index Holdings (CIH), painted a similar picture.
Total sales of the top 100 property developers for the first five months were down 10.8 per cent year-on-year to 1.4 trillion yuan, according to a recent CIH report. In the CIH report, sales included revenue from projects managed by both developers' in-house sales teams and those outsourced.
For May alone, sales by top developers fell 8.6 per cent year-on-year to nearly 295 billion yuan, although the total was up 3.5 per cent on a month-on-month basis, according to CRIC figures. The CIH data showed an even steeper year-on-year sales drop of 17.3 per cent for May, with the decline widening from 16.8 per cent in April.
A NEWSLETTER FOR YOU
Tuesday, 12 pm Property Insights
Get an exclusive analysis of real estate and property news in Singapore and beyond.
Sign Up
Sign Up
To put the scale of the downturn in perspective, sales of 1.3 trillion yuan amount to less than 30 per cent of the total made over the first five months of 2021, before the slump began.
The May sales figures offer a broader view of a national real estate market that has grown increasingly bifurcated. Analysts have been highlighting the difference in demand between metropolises such as Beijing and Shanghai and in lower-tier Chinese cities.
In Shanghai, demand looks to be heating up. According to a report by EH Consulting, a real estate industry research institute, multiple residential projects managed to sell out in a single day in May.
In one example, a local subsidiary of developer Greentown China Holdings sold all 120 units of a project on the same day it was put on the market, the report said. The homes sold for 195,000 yuan per square meter, generating nearly 7 billion yuan in revenue.
It's a different story in some of China's lesser-known and less wealthy cities. The vast majority of property developments in third and fourth-tier cities have far more supply than demand, said a senior sales executive at a leading property developer who did not wish to be named.
Two factors have long helped drive China's property market: the need for new homes and the belief that housing was a sure-fire investment.
Since the downturn, however, residential property has lost its appeal as an investment in many third- and fourth-tier cities, the executive said. In addition, basic housing needs have already been met in those areas.
With the populations of many of the cities already starting to shrink and with the average household already owning two or three homes, a slowdown in home sales was inevitable
'In the long run, we believe the property market will eventually stabilise,' the executive said. 'But in the near term, market divergence will persist.'
Addressing the disparity requires tackling the problem from both the supply and demand sides, market insiders said.
The CRIC report noted that the current new housing supply has fallen significantly, particularly in hot markets such as Shanghai, Shenzhen, Hangzhou and Chengdu. The situation has limited the potential for a surge in sales volume in those cities.
Changes to government policy could help. The EH Consulting report recommended shifting from broad-based stimulus to more targeted, nuanced regulation over the property market. That would help different parts of the market achieve a better balance between supply and demand that would eventually stabilise prices.
CIH expects housing market policy to remain accommodative in June. With the mid-year sales window approaching, property developers are likely to accelerate project launches and increase their marketing efforts, the report said.
It added that the market in core cities is expected to continue its recovery, although divergences between cities are likely to continue. CAIXIN GLOBAL
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
2 hours ago
- Straits Times
Nvidia's Jensen Huang turns on the charm in Beijing amid US-China tech rivalry
Nvidia co-founder Jensen Huang ditched his iconic black leather jacket for a traditional Tang suit at a trade exhibition in Beijing on July 16. - On a high-profile trip to China, with billions in potential sales to the lucrative Chinese semiconductor market at stake, Nvidia co-founder Jensen Huang ditched his iconic black leather jacket for a traditional Tang suit. At the opening of a trade exhibition in Beijing on July 16, the Taiwan-born American spoke a few sentences of halting Mandarin, before adding to laughter: 'I'm going to do the rest of my speech in English now. So I don't torture you for the rest of the day.' Describing AI (artificial intelligence) models from Chinese tech players like DeepSeek, Alibaba and Baidu as 'world-class', he said: 'The heroes of China's super fast innovation are your researchers, developers and entrepreneurs. More than 1.5 million developers in China build on Nvidia today to bring their innovations to life.' Nvidia is at the heart of a global AI boom and last week became the first public company to hit US$4 trillion in stock market value . Mr Huang, who is among the American tech executives who are trying to court Chinese customers while not falling afoul of Washington's national security concerns, has come prepared on his third China visit of the year. On July 15, Nvidia announced that sales of its H20 chip to China would resume , with Washington's nod. The AI chip, a less powerful version of the firm's flagship H100, had been banned in April when Washington tightened export controls to China. But analysts said the move to approve the China-specific chip is merely a reprieve which may not last, with technology at the heart of US-China competition and both countries still in the middle of a 90-day trade truce since May 12. Top stories Swipe. Select. Stay informed. Singapore Over 600 Telegram groups in Singapore selling, advertising vapes removed by HSA Singapore 2 weeks' jail for man caught smuggling over 1,800 vapes and pods into Singapore Singapore Jail for man who fatally hit his daughter, 2, while driving van without licence Singapore Primary 1 registration: 38 primary schools to conduct ballot in Phase 2A Singapore ComfortDelGro to introduce new taxi cancellation, waiting fee policy Singapore Here comes the sun: Less rain, more warm days in second half of July Singapore Instead of overcomplicating COE system, Govt has ensured affordable transport for all: SM Lee to Jamus Lim Singapore Baby died after mum took abortion pills and gave birth in toilet; coroner records an open verdict The H20's ban was estimated to have cost Nvidia US$10.5 billion across its April and July quarters. The policy reversal came after Mr Huang lobbied US President Donald Trump at the White House last week. On his visit, Mr Huang also unveiled a new graphics processing unit for the China market called the RTX Pro, which he said is 'fully compliant' with US export restrictions and would be designed for smart factories and robot training purposes. 'It takes 200 different technology companies to build one of our AI computers… it is not possible without a sophisticated supply chain,' he told President Ren Hongbin of the China Council for the Promotion of International Trade. 'That's why I'm here - to celebrate the miracle of the (Chinese) supply chain.' The Council, a government-affiliated trade body, is the organiser of the 3rd International Supply Chain Expo held in Beijing from July 16 to 20, which Nvidia took part in for the first time. Mr Huang was among the speakers at the opening ceremony. Even as he received the VIP treatment in China, Nvidia has remained caught in the crosshairs of Washington and Beijing. Mr Huang has argued that continuing to sell to China means that the US is not ceding the Chinese market to domestic players such as Huawei. He has also said that US tech export controls to China have failed, and have only pushed Chinese firms to innovate more quickly. But some, including US Commerce Secretary Howard Lutnick, have said that Nvidia and other companies should stop helping China use 'our tools to compete with us'. Associate Professor Marina Zhang of the University of Technology Sydney saw Mr Huang's recent remarks as an effort to position himself - and Nvidia - as both compliant with US policy and indispensable to China's AI eco-system. Prof Zhang, who researches on China and technology issues, did not see the approval of the H20 as a reversal in policy, but more of a calibration. 'It reflects a 'precision sanctions' approach: allowing US firms to serve China's mid-tier AI market - keeping American players commercially viable - while still blocking access to cutting-edge compute essential for training frontier models. 'Washington is walking a tightrope: trying to avoid a full market exit for firms like Nvidia while continuing to constrain China's long-term AI capabilities,' she said, adding that this policy adjustment will not reverse China's determination to develop indigenous technologies, particularly in semiconductors. Dr Sun Chenghao, who researches US foreign policy and US-China relations at Tsinghua University, said the US decision to resume H20 chip sales to China did not represent a fundamental reversal of export controls. Rather, it is a temporary concession driven by commercial pressure and geopolitical calculations. Nvidia suffered significant losses under April's export ban, prompting Mr Huang to lobby intensely for policy adjustments, he said. 'While Washington greenlit the sales, it strictly capped the H20's performance (merely 15 to 30 per cent of the H100's capabilities) to prevent its use in cutting-edge AI training—revealing its unchanged core aim: delaying China's technological advancement.' Dr Sun said Washington could reimpose stricter controls if China's domestic chip substitutes progress faster than expected, or if US political pressures intensify. 'Notably, America has explicitly tied tech export policies to broader trade negotiations, meaning export restrictions will remain a bargaining chip to pressure China if talks stall,' he added. Mr Huang himself saw such geopolitical issues as beyond his control. When asked about the impact of US tariffs in a press conference on July 16, he said Nvidia would simply have to adapt. 'There were trade, taxes and tariffs before I came into Nvidia. There will be trade, tariffs and taxes after I leave Nvidia.'
Business Times
4 hours ago
- Business Times
China vows to regulate ‘irrational' competition in EV industry
[BEIJING] China's Cabinet on Wednesday (Jul 16) pledged to regulate what it called 'irrational' competition in the country's electric vehicle industry, vowing to strengthen cost investigation and price monitoring, according to state broadcaster CCTV. The Cabinet meeting, presided by Chinese Premier Li Qiang, was held as a two-year price war in the world's largest auto market only intensifies. China will focus on promoting the high-quality development of the electric vehicle industry and implement comprehensive measures in both the short- and long-term to address the 'phenomenon of irrational competition' in the sector, CCTV quoted the Cabinet as saying, without giving further details. The Cabinet will also urge the main automakers to fulfil commitments on supplier payment terms and promised to help them boost competitiveness through technological innovation and quality improvement. Industry regulators and executives have previously warned of excessive competition and called on automakers to halt the bruising price war which they say threatens the sector's health and sustainable development. Concerns about oversupply persist, with new vehicles being shipped overseas as 'used' since 2019, according to a Reuters report in late June. Separately, the Cabinet meeting discussed boosting domestic consumption, with policymakers vowing to systematically remove unreasonable restrictions that hinder household spending and optimise policies for a consumer goods trade-in program. REUTERS
Business Times
4 hours ago
- Business Times
WTO overhaul targets fairer trade, easier decision-making to end paralysis
[GENEVA] World Trade Organization members are seeking to break years of paralysis in international trade negotiations, which have been sidelined by the Trump administration and risk becoming irrelevant, internal WTO documents seen by Reuters. Trump's sweeping tariffs have forced countries to line up to negotiate bilateral trade deals with Washington, bypassing the multilateral framework. WTO members had already struggled to reach deals due to a consensus requirement among all 166 members. Preventing members from blocking decisions is now the top priority in reform talks, diplomats told Reuters. 'The sense of urgency is palpable, and there is widespread recognition that there is no viable alternative to reform,' Norway's WTO Ambassador Peter Olberg, who was appointed to facilitate the organisation's reform talks, said in an internal communication to members seen by Reuters. The WTO's foundational Most Favoured Nation (MFN) rule requires equal treatment among members but developing countries have privileges to help them compete. These include China and India, which Trump argues are now major economies with no need for extra support. One document showed WTO members are aiming to streamline decision-making processes, promote fairer industrial policies including subsidies, and review the privileges of developing countries. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The proposals feed into reform consultations running through the latter part of this year that are intended to inform the next WTO ministerial conference in Cameroon in March. The latest round of consultations is taking place this week. Among the proposals is the so-called Pareto improvement, which a senior Chinese WTO delegate in Geneva said China had put forward. This measure would require members to provide clear, evidence-based proof of harm when blocking proposals. Other proposals include permitting members to opt out of decisions and allowing subsets of countries to advance negotiations without full consensus. 'The post-war multilateral system as we know it is dead,' Roberto Azevedo, WTO Director-General from 2013 to 2020, told Reuters, calling reform discussions a 'do or die' situation for the WTO in particular. WTO Director-General Ngozi Okonjo-Iweala conveyed the US position to members in a restricted document viewed by Reuters, that a 'reform by doing' approach – of practical, incremental improvements in the organisation's functioning – is 'vacuous' and would fail to tackle the deeper structural issues. The US said in its 2025 trade policy agenda that its patience is 'wearing thin' and that key issues will not be resolved until China and other major economies – implying countries like India – relinquish their privileges. China said in June that it had heard 'every word' of the US concerns, expressing openness to discuss such privileges, as well as tariffs and industrial policy. India's WTO mission did not respond to a request for comment. Current reform talks do not address the dispute settlement system, which will be considered at a later date, according to one of the WTO documents. The WTO declined to comment on this article. Olberg did not immediately reply to a request for comment. REUTERS
