Policy and financial dual empowerment: Warmth spreading in the Beijing, Shanghai, and Shenzhen real estate markets

By Our Reporter Li Bing, Xiong Yue

As the spring tide surges, warmth gradually spreads.

A “warm current” is flowing through the first-tier residential real estate market, and the trend of the market stabilizing is becoming increasingly clear. Closely aligned with the strategic direction in the “Fifteenth Five-Year Plan” to “promote high-quality development of real estate,” and anchored to the 2026 Government Work Report’s deployment to “focus on stabilizing the real estate market,” policy guidance and financial practice are jointly exerting efforts in the same direction. This continuously invigorates first-tier markets and promotes a healthy and virtuous cycle in the real estate industry.

On February 25, 2026, five departments including the Shanghai Municipal Housing and Urban-Rural Construction Management Commission issued a notice titled “Notice on Further Optimizing and Adjusting Real Estate Policies in This City” (hereinafter referred to as the “Notice”). As of March 25, the new policy has been in full implementation for one month. Data from the Lianjia Research Institute shows that from March 1 to March 23, 2026, there were 22,400 units of secondhand residential property transactions in Shanghai, with transaction volume up 11% year-on-year over the same period in 2025. Not only Shanghai—currently, Beijing, Shanghai, and Shenzhen have all simultaneously lowered personal housing loan interest rates and down payment ratios. As the three cities implement measures tailored to their local conditions, the relevant policies have entered a period of steady observation.

《Securities Daily》 reporters went specifically to Beijing, Shanghai, and Shenzhen to conduct on-site investigations. In face-to-face conversations with practitioners of financial institutions, real estate agents, homebuyers, and sellers/owners, reporters comprehensively assessed the real situation in first-tier markets. Based on the comprehensive investigation, the residential real estate market in the core areas of the three cities has already shown signs of stabilizing. For-sale-to-live-in demand (rigid demand) and improvement-oriented demand have become the key forces driving current market transactions.

Policy and Finance Working Together

Cutting the Cost of Buying a Home in a Practical Way

Under the framework of macro policy, Beijing, Shanghai, and Shenzhen have each introduced locally tailored real estate loosening policies, ranging from easing purchase limits and optimizing commercial mortgage policies to increasing support through housing provident funds. They precisely support residents’ reasonable housing needs, forming policy synergy.

The aforementioned “Notice” shows that it optimizes and adjusts policies across seven areas, including housing purchase limits, housing provident-fund loans, and personal housing property tax. On that basis, local commercial real-estate credit policies have been further optimized. Since March 16, the minimum down payment ratio for commercial real-estate (including “commercial-residential properties”) purchase loans in Shanghai has been adjusted to no less than 30%.

Li Gen, head of the Lianjia Research Institute, said in an interview with reporters from 《Securities Daily》: “Currently, Shanghai Lianjia’s daily average number of property viewings has grown by 30% compared with before the new housing-market policy took effect; the daily average number of newly added customers has increased by 51% compared with before the new policy. Confidence to enter the market has risen significantly compared with before the new policy, and both viewings and transactions are very active.”

In Beijing, meanwhile, in 2025 it issued two notices for further optimizing and adjusting real-estate-related policies. On August 8, 2025, the policy eased purchase limits outside the Fifth Ring Road—meaning that outside the Fifth Ring Road, the purchase of commercial residential properties (including newly built commercial residential units and secondhand housing) is not subject to any cap on the number of units. On December 24, 2025, the Beijing Municipal Housing and Urban-Rural Development Commission and other departments again released new real-estate market policies, adjusting the social insurance or personal income tax payment years required for non-local registered household families to purchase commercial housing within and outside the Fifth Ring Road, and in terms of the interest rate pricing mechanism, no longer distinguishing between first-home and second-home properties.

Reporters learned from multiple state-owned major banks that currently, Beijing’s commercial housing loans use the 5-year-and-above LPR (3.50%) as the pricing benchmark, and many banks’ actual executed interest rates are generally around 3.05%. Our calculations show that, for example, when buying a second home within the Fifth Ring Road and taking a loan of 1 million with equal principal repayment over 30 years, compared with the 3.45% interest rate applied before December 24, 2025, the new policy reduces the monthly payment by more than 100 yuan, and the total repayment amount over the life of the loan can be saved by tens of thousands of yuan.

Shenzhen has implemented optimization and adjustment measures for real-estate policies since September 6, 2025, including optimizing and adjusting personal housing credit policies. In particular, commercial-mortgage interest rates no longer differentiate between first-home and second-home properties.

“Since last year, first-tier cities have issued in dense succession measures to reduce down payment ratios, lower mortgage rates, and optimize controls on purchases and mortgage lending. These measures have effectively lowered the homebuying threshold for residents and formed a strong financial support package, helping market sentiment repair at the margin.” Cao Jingjing, General Manager of the Index Research Department at the China Index Academy, told 《Securities Daily》 reporters. “As for the reasons, on one hand the new policies have produced visible effects, effectively driving the release of potential homebuyer demand; on the other hand, prices in quality districts within core cities have gradually approached more reasonable levels. The market is currently showing clear structural divergence: transaction activity for high-quality projects in core urban areas is higher, while inventory pressure in areas farther from the suburbs remains.”

A series of policy combination punches, together with financial support and enablement, has continued to raise transaction activity in first-tier city housing markets. On March 16, the National Bureau of Statistics released data on changes in the sales prices of commercial residential housing in 70 large and medium-sized cities in February, showing that the month-on-month decline in sales prices for the 70 cities continued to narrow.

According to data from the National Bureau of Statistics, in February, the month-on-month change in sales prices of newly built commercial residential housing in first-tier cities shifted from falling 0.3% in the previous month to being flat. Among them, Beijing and Shanghai both increased by 0.2%, Guangzhou was flat, and Shenzhen fell by 0.3%. Secondhand residential housing prices in first-tier cities fell 0.1% month-on-month, with the decline narrowing by 0.4 percentage points compared with the previous month; specifically, Beijing and Shanghai increased by 0.3% and 0.2%, respectively.

“From an objective standpoint, first-tier cities’ housing markets have already shown positive performance—especially once price adjustments and the release of policy effects have taken hold, they have produced excellent combined effects.” Yan Yuejin, Vice President of the Shanghai E-House Real Estate Research Institute, told 《Securities Daily》 reporters. “In the case of Shanghai, the increased market transaction volume in this round is not driven by a single factor, but rather the result of multiple favorable factors overlapping: first, policy dividends continue to be released, and financial enablement accurately injects liquidity into the market with targeted support, providing strong impetus; second, price adjustments are in place and confidence is gradually restored; third, potential demand objectively exists.”

Agents “Get Busy”

Witnessing the Warmth in First-Tier Housing Markets

“Sun-facing flowers and trees make spring easier,” and first-tier real estate buying-and-selling brokers can most keenly sense the warmth in the housing market. With the new policy empowering it, transaction activity in the Beijing-Shanghai-Shenzhen housing markets has increased significantly.

“At 7 a.m. I ate three eggs, and I kept busy until around 8 p.m.” The firsthand account of Li Kai, a Beijing new-home sales agent (pseudonym), vividly shows the market heat after the new policy took effect. He admitted that he completed seven contract signings on just one Saturday, and even lunch had to be booked in advance. Li Kai’s situation is not unique; it is a common phenomenon among real estate agents in Beijing, Shanghai, and Shenzhen.

As night falls, in a real estate agency storefront in Xicheng District, Beijing, the lights are still on brightly. All three contract signing rooms are filled—there is no vacant seat. The walls are covered with colorful banners and pennants presented by owners and homebuyers, while the printing area continues producing housing transaction contracts, and everywhere the air is full of busyness. Zhang Li, a secondhand housing agent in Beijing (pseudonym), told reporters that inquiry and viewing calls keep coming one after another. She said that recently, demand for customer appointments to view homes, owners listing properties, and policy-related inquiries have clearly increased, and “good news” about transactions from inside the branch keeps popping up on screens. Just on March 14, the area’s transaction volume exceeded 170 deals; among them, four large districts each completed more than five deals, and nine large districts each completed four deals.

Far away in Shanghai, real estate agents are busy as well. Even at 9 p.m., agent Chen Jun (pseudonym) is still replying to customers’ questions about viewing homes. He said that since early in the year, the market pace has clearly accelerated, with both inquiries and viewing volumes continuing to rise. On the very day the “Notice” was rolled out, industry peers quickly sorted out and interpreted it and then circulated and promoted it. Customer inquiry volume climbed further, and within the inner ring, transactions for high value-for-money listings were especially active.

Data provided by an agent from a certain real estate transaction platform shows that on just March 14, the platform’s secondhand home transaction volume in Shanghai already exceeded 1,400 units.

Behind this rush of busyness is the agency industry’s proactive drive to change. During visits, reporters found that many real estate agency stores have strengthened policy training to ensure agents accurately grasp the latest policies and are skilled in core areas such as down payment ratios and adjustments to mortgage interest rates. The busy figures of real estate brokers have become the most direct, vivid footnote for the current rebound in the housing market.

Both Sides of the Transaction Have Their Considerations

Supporting the Steady Development of the Industry Chain

The core dividend of the new housing market policies benefits not only homebuyers, but also the entire real estate market ecosystem more deeply, injecting strong momentum into the industry’s healthy and virtuous cycle. On the policy side, targeted measures and locally driven efforts build a solid foundation for stability; on the financial side, targeted liquidity support and proactive action form a combined force, pushing the industry steadily toward high-quality development and enabling a positive closed loop in the housing market ecosystem.

Rigid homebuyers feel that there are more homes they can actually afford. Li Hui, who works in Beijing, started looking for homes from early 2025, and due to limited budget he had been hesitant. Originally he could only afford a one-bedroom unit. After the new policy was issued, now he can afford a small two-bedroom home, and he is preparing to make a move soon.

Liu Hong, an office worker living in Minhang District, Shanghai, also frankly said that among her colleagues and friends who are not registered residents of Shanghai, discussions about buying homes have increased recently. “Now there are policy tailwinds. Some friends are also gradually observing—just looking at suitable listings.”

Improvement-oriented groups have leveraged the policy headwind to optimize living conditions. The release of relocation/turnover demand not only activates existing housing inventory, but also increases market liquidity, helping the housing market ecosystem form a healthy cycle of “selling the old and buying the new.” Wang Zongxu in Shenzhen plans to purchase a secondhand home. He said, “I’m still observing for now, mainly because it’s driven by improvement needs. I want to trade up to a home in a core area. For me, that counts as a fairly steady asset allocation.”

Corresponding to homebuyers actively entering the market, sellers’ mindsets also change subtly under the influence of the new policies. Sellers with relocation/turnover demand have become positive responders to the new policies. They take advantage of the market’s rising heat, proactively list their homes and offer moderate incentives, hoping to sell their listings as soon as possible to complete the relocation. At the same time, some sellers list properties purely to realize cash and exit the market, enriching the level of supply in the market.

A 《Securities Daily》 reporter previously accompanied homebuyer Zhang Jun in negotiations for an intended secondhand home. The listing price for the unit was 5.28 million yuan. Before the negotiations, the intermediary disclosed that based on the owner’s earlier psychological price, the deal could be expected to fall below 5 million yuan. However, during the negotiation, the owner’s attitude changed clearly, showing a “hesitation to sell” mindset. The owner explicitly stated that they would not sell if the price was below 5 million yuan. The negotiation lasted less than an hour and the transaction could not be reached. However, such owners’ reluctance to sell indirectly reflects that market confidence is gradually being restored.

Zhang Li told reporters that the transaction volume in her assigned area has indeed picked up, but there has not been a broad-based surge in home prices. Only in certain core areas have prices of high-quality listings shown a modest upward trend.

Overall, after the new policies were rolled out, transaction activity in the Beijing-Shanghai-Shenzhen housing markets has continued to rise. Whether it is relocation, monetization/realization, or observation, market participants are all finding the best solution according to their own needs. These diversified patterns of market behavior together form a healthy and orderly housing market ecosystem. Moreover, the increase in activity and the return of transactions to rationality further consolidate the trend of stabilization in the housing market.

In Cao Jingjing’s view, this round of policy optimization shows the characteristics of “city-specific measures and targeted injections of liquidity.” Through synchronized efforts—loosening homebuying eligibility in a stepwise way and lowering financing costs—it has effectively reduced the threshold for residents to purchase homes.

More importantly, as a key support point for pulling the entire housing market toward stabilization and recovery, the stabilization and repair of first-tier housing markets will continuously release positive signals to the market and help consolidate the foundation of the entire real estate market.

“Currently, the stabilization of first-tier housing markets has brought positive effects to both upstream and downstream of the industry chain. Taking Shanghai secondhand homes as an example, transaction activity for secondhand homes in core areas has remained active, directly driving rapid growth in subsequent consumption businesses such as home renovations, home furnishings, and household appliances.” Yan Yuejin said. When the real estate market improves and companies’ financial conditions improve, combined with rising demand for high-quality living, it will also create more market demand in emerging areas such as AI and robots.

Du Juan, Senior Researcher at the China Merchant Industrial Bank Research Institute, said: “The real estate industry chain is long—upstream covering construction materials and downstream covering renovations and home appliances, spanning multiple categories. Stabilization of the real estate market is not only a rebound in market transactions, but also the resurgence of the entire industrial chain and a boost to consumption. This kind of multi-dimensional positive feedback keeps improving the housing market ecosystem and forms a healthy virtuous cycle of ‘market stabilization, industry chain recovery, consumption upgrades, and ecosystem optimization.’”

For homebuyers, Du Juan advised that first, the priority is to meet housing needs; second, to consider purchasing power—what matters is to act within one’s means and strengthen awareness of rights protection; third, to pay attention to additional expenditures, which requires comprehensive coordination of funds; fourth, to monitor the new policies promptly and strive to obtain relevant support.

With policy and finance working bidirectionally, they not only effectively lower the homebuying threshold for residents, but also play an important role in easing developers’ liquidity pressures and pulling the recovery of upstream and downstream real estate industry chains, among other effects. This injects sustained momentum into achieving a virtuous cycle and high-quality development of the real estate ecosystem.

(Editor: Wen Jing)

Keywords:

                                                            Housing market