China home-price slump shows signs of easing

September data show slower home-price declines

New-home prices across 70 major Chinese cities fell 0.14% month-on-month in September 2026, easing from a 0.17% decline in August. On a year-on-year basis, prices were down 2.8%, highlighting that the property sector remains under pressure despite the softer monthly drop.

The moderation in the pace of decline indicates that downward momentum in the housing market has weakened, but not reversed. The figures point to tentative signs of stabilisation rather than a broad-based recovery, with conditions differing significantly between large metropolitan areas and smaller cities.

First-tier cities diverge from weaker markets

National Bureau of Statistics data for September show new-home prices in first-tier cities rising 0.1% month-on-month. Within this group, Shanghai, Guangzhou and Shenzhen recorded gains of about 0.2%–0.3%, while Beijing’s new-home prices slipped around 0.2% over the month.

These moves underscore a split between top-tier urban centres, where demand appears more resilient, and many lower-tier cities that continue to see price declines. The performance of the largest cities is playing an important role in tempering national averages even as broad market weakness persists.

Targeted mortgage support rolled out in late September

In late September 2026, authorities introduced targeted measures aimed at supporting the housing market, including a nationwide mortgage-interest subsidy for eligible homebuyers. The scheme applies to purchases up to about 1.5 million yuan, reflecting an effort to focus support on more affordable segments.

The measures are designed as calibrated interventions rather than sweeping stimulus, with city- and buyer-specific criteria intended to channel assistance where housing demand is most fragile. This approach seeks to bolster purchasing power while avoiding a broad loosening that could reignite financial risks.

Property slump weighs on an uneven economic recovery

China’s overall economic growth improved in the third quarter of 2026, with year-on-year expansion reported at about 4.5%–4.6%. Stronger exports and solid factory output contributed to the better performance, helping offset headwinds from the domestic property downturn.

Despite the improvement in headline growth, the prolonged housing-market slump continues to drag on consumer demand and local government revenues. The September price data and late-September support measures highlight policymakers’ challenge of sustaining economic momentum while gradually stabilising a still-fragile real-estate sector.