During China’s slow-moving housing crash, there have been brief stretches when prices stabilized, raising hopes that the multiyear slide was finally over. Each time, those reprieves have proved short-lived — pauses before the market resumed its decline.
After housing prices in several of China’s biggest cities leveled off in the first few months of the year, the market is again at a crossroads. Analysts and economists are split over whether this constitutes a bottom for a downturn that has eroded much of the country’s middle-class savings or merely another lull before the next leg down.
Average prices for existing homes in China’s so-called Tier 1 cities — Beijing, Shanghai, Shenzhen and Guangzhou — ticked up 2 percent from February through April, according to data compiled by UBS, the Swiss financial institution, and Centaline, one of China’s largest real estate brokerage firms. The uptick followed a 38 percent plunge since 2021 that has rippled through the Chinese and global economies.
The toll of the crash has been heavy at home and consequential abroad. Many Chinese families had poured the bulk of their savings into apartments, treating property as a safe bet for building wealth — only to discover, to their anger and dismay, that it was anything but.
Timothy Liu, an office worker in China’s north-central Henan Province, is one of those buyers. He spent about $76,000 on a small apartment in his hometown in 2021, only to see its value drop by nearly a third. Like many in China, he lost his job two years ago and has struggled to find another as the economy has slowed, in part because of the housing downturn.
His only consolation is that he paid cash for a modest home in a low-cost neighborhood rather than borrowing money to buy in a big city. “Although I managed to avoid taking on a huge mortgage in a first-tier city, my apartment has still dropped in value by nearly 30 percent — I’m really upset about it,” he said.
