S&P Sees China Home Prices Bottoming in Q3 2028 as Tier-1 Cities Recover in 2027

1 articles · Updated · CNBC · Oct 8

China’s residential property prices may bottom in the third quarter of 2028, S&P Global Ratings said, while Beijing and Shanghai could start recovering as soon as next year.
Two policy shifts drove S&P’s reversal from its February view: August curbs on developers selling unfinished homes and later support measures including mortgage subsidies for first-time buyers of homes under 1.5 million yuan.
Supply reduction is central to the call, with S&P saying 2026 is the first year of inventory destocking and developers are likely to buy less land and launch fewer projects, easing oversupply.
The downturn has already cut home prices 22% from their 2021 peak; S&P said China is stabilizing earlier than Japan did, while another economist sees tier-one existing home prices returning to growth as soon as Q4 2026.
Demand is improving but durability is unclear: holiday-period existing-home sales in 25 cities jumped 50% year on year, yet Morgan Stanley said subsidies may mostly pull forward purchases rather than create lasting new demand.

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Are recent spikes in Chinese home sales a true market bottom, or just a temporary illusion fueled by short-term government subsidies?

With China's housing slump fueling a massive export surge, could this real estate crisis quietly trigger the next global trade war?

As developer land purchases collapse, how will China's local governments survive the devastating loss of their primary revenue source?

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