Cushman expects some 180,000 new homes to change hands in the second half of the year, up from 133,000 in the first six months. This would further narrow the annualised decline to 20 per cent over the period and take transactions for the whole of 2024 to around 310,000.
“We believe that the GBA residential transaction volume will gradually expand in the second half of the year,” said Alva To, vice-president for Greater China at Cushman & Wakefield.
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Shenzhen leads low-altitude economy with new helicopter service at railway station
Shenzhen leads low-altitude economy with new helicopter service at railway station
He credited Beijing’s ambitious rescue package launched in May that included a 300 billion yuan relending facility to clear excess inventory, as well as positive messages about further market reforms that emerged from this month’s third plenum, a meeting of the Central Committee of the ruling Communist Party that laid out China’s economic road map for the medium term.
The primary home market for the bay area recorded 132,833 transactions in the first half of 2024, down 15 per cent from the second half of 2023. That figure was also 40 per cent lower than the same period last year, having been dragged down by slow demand stemming from economic headwinds, according to Cushman.
Guangzhou, the provincial capital of Guangdong, saw 30,000 new residential units sold in the first half of the year, an 8.7 per cent decline when compared with the second half of last year. Shenzhen, dubbed China’s Silicon Valley, saw new home sales fall 12.7 per cent to 15,299 units in the same period.
Both cities witnessed a strong rebound in transactions last month, having eased home-purchasing restrictions and lowered mortgage rates to lure buyers late in May.
Home transactions in Guangzhou’s primary market reached 7,623 in June, the most in a year, while more than 10,000 second-hand homes found buyers, a surge of 33 per cent from May. In Shenzhen, the second-hand market saw 5,309 units change hands, the most in more than three years, according to data compiled by Centaline Property.
“The worst time for the residential property market is over,” said To. “Prices are expected to stabilise gradually in the future with the recovery in demand, though the pace will be slow.”
The launch of the Shenzhen-Zhongshan link is another favourable factor bolstering home sales in the bay area. The newly constructed bridge-tunnel reduces the travel time within the zone, encouraging buyers from Hong Kong and other major cities to purchase houses in Zhongshan.
This has made the Zhongshan home market resilient. While other cities in the bay area have felt the effects of the depressed market – Zhuhai, for example, saw a 21.3 per cent drop in average house prices in the first six months, the prices of Zhongshan houses have increased by 2.5 per cent compared with the end of 2023.