Experts see signs of recovery in realty data

The latest property investment and sales data from the National Bureau of Statistics indicate that a recovery in both supply and demand is taking shape, boding well for further market stabilization in the coming months, industry experts said on Tuesday.

China's investment in property development rose 3.7 percent year-on-year to 1.45 trillion yuan ($227.4 billion) in the first two months.

Investment in residential buildings alone rose by 3.7 percent year-on-year to about 1.08 trillion yuan, NBS data showed.

The stable real estate investment data suggest the fundamentals of the property sector are stabilizing, though there remains certain pressure in liquidity, said Pan Hao, senior analyst with the Beike Research Institute.

"In order to boost the stabilization of the property market and enhance confidence of homebuyers, joint efforts are required by real estate developers, local governments as well as financial institutions," Pan said.

Industry analysts said the real estate financing environment has improved of late. Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, also said as much during a State Council Information Office news conference on March 2. "The real estate sector's bubbling and financialized trends have been fundamentally reversed," Guo said at the time.

In January and February, new property development amounted to 149.67 million square meters, down 12 percent year-on-year-this is perhaps a reflection of the capital pressure on real estate developers and the attendant market adjustment, said Chen Wenjing, deputy director of research with the China Index Academy.

But, consistent improvement in the property credit environment could mean property enterprises' capital flows will likely also improve down the line, Chen said.

From January to February, commercial housing sales fell nearly 10 percent year-on-year in terms of floor area to about 157 million sq m and declined 19 percent to 1.55 trillion yuan in terms of value, NBS data showed.

Sales volume, however, has grown mildly in comparison with growth in the same period of 2017 and 2019, showing market confidence is getting boosted, thanks to measures like local governments' specialized policies, provident fund loans, loans borrowed from commercial banks and favorable housing policies to attract talent, Pan said.

Since the beginning of the year, under the guideline of fully releasing homebuyers' demand and satisfying rational home-buying requirements, many Chinese cities announced measures to stabilize their housing markets.

In addition, improvements made to the financing and credit environment to support rational demand as well as property developers' proactive offerings are creating a positive outlook for the home market in coming months, said Yan Yuejin, director of Shanghai-based E-house China Research and Development Institution.

The market recovery cannot be realized without appropriate measures and stable supply and demand, said Chen.