Visiting the real estate "Little Spring" | Important changes in the first quarter of the real estate market, some leading property companies and institutions: the industry's most difficult period has passed

The Daily Economic News Reporter: Chen Ronghao The Daily Economic News Editor: Yang Jun

Important shifts have occurred in the housing market during the first quarter of 2026.

In the 2026 Government Work Report, the wording regarding real estate goals was adjusted from “continue to exert efforts to stabilize the housing market and bring it back to stability” in 2025 to “focus on stabilizing the housing market.”

Meanwhile, departments such as the Ministry of Housing and Urban-Rural Development, the State Administration of Financial Supervision, and the Ministry of Finance have issued frequent statements, normalizing the operation of the urban real estate financing coordination mechanism, increasing efforts to collect and store stock land and commercial housing through special bonds, and accelerating the implementation of policies supporting urban renewal.

On January 15, 2026, the State Administration of Financial Supervision stated at the 2026 Regulatory Work Conference that efforts should be made to promote the normalization of the urban real estate financing coordination mechanism; on March 17, the Ministry of Finance mentioned in the “2025 China Fiscal Policy Implementation Report” that policies supporting the acquisition of stock commercial housing with special bonds, such as ensuring affordable housing, should be well implemented.

Based on this, some leading real estate companies and institutions believe that the industry’s most difficult period has passed, and it will enter a cycle of bottoming out, deep differentiation, with core cities and high-quality sectors leading the recovery.

“Real estate policies have basically been exhausted; the next step is to identify gaps and see if there are ‘last mile’ issues in policy implementation,” said Li Yujia, Chief Researcher at the Guangdong Housing Policy Research Center, in an interview with the Daily Economic News on March 31. Currently, the most effective policies for the housing market are those that focus on new urbanization, localizing new residents, and stabilizing employment.

Special Bonds Become an Important Tool

In the first quarter of 2026, the real estate financing environment remained relaxed, and the urban real estate financing coordination mechanism officially entered a normal operation phase. On January 15, at the annual regulatory work conference, the State Administration of Financial Supervision clarified that this mechanism should be promoted to facilitate the development of new models in real estate.

On January 21, Ni Hong, Minister of Housing and Urban-Rural Development, mentioned in an interview that this year efforts will be made to stabilize the housing market, leverage the “white list” system for real estate financing, support reasonable financing needs of developers, and implement a principal bank system for real estate financing.

On March 16, the Party Committee of the State Administration of Financial Supervision further emphasized the role of the “guaranteed delivery” white list system and accelerated the establishment of a financing system compatible with new real estate development models.

Key Policies on Financing in Q1 2026 Source: CRIC

“The normalization of the white list system is an important improvement to the real estate financing coordination mechanism,” said Liu Shui, Head of the Enterprise and Business Department at the China Index Academy. This mechanism will effectively boost financial institutions’ confidence in developers and indicates that the support policy for developer financing through the white list is shifting from short-term relief to long-term security.

Regarding risk prevention, special bonds are becoming a vital tool for inventory reduction and risk mitigation. The Ministry of Finance’s “2025 China Fiscal Policy Implementation Report” released on March 17 proposed that urban renewal should be steadily promoted in 2026, with policies supporting the acquisition of stock commercial housing as affordable housing, and regional fiscal policies should be implemented and improved to enhance regional development coordination.

Yan Yuejin, Deputy Director of the Shanghai E-House Real Estate Research Institute, analyzed that using special bonds to acquire stock land and commercial housing achieves three benefits: opening bulk destocking channels for developers, alleviating liquidity pressure, and low-cost supplementation of affordable housing sources, as well as optimizing market supply and demand and stabilizing expectations.

Another key measure on the financing side is the optimization of commercial property mortgage policies. At the beginning of 2026, the People’s Bank of China and the State Administration of Financial Supervision lowered the down payment ratio for commercial property purchases nationwide to 30%, with rapid follow-up in Shanghai, Guangdong, and other regions. Beijing, Qinghai, and others further emphasized revitalizing idle commercial facilities: Beijing allows conversion between commercial, business, financial, and entertainment land uses; Qinghai promotes stock commercial facilities through building function conversion and mixed-use approaches, providing more pathways for destocking commercial office inventory.

The China Index Academy pointed out that increasing support for commercial office properties by the central bank reflects a focus on destocking the commercial real estate market and indicates an increased emphasis by regulators on the inventory reduction of commercial projects. In recent years, many cities have introduced policies supporting conversions of existing commercial office projects into rental housing, supporting building compatibility, and temporary use changes.

“The Bottom of the Real Estate Market Is Gradually Coming Into View”

The Daily Economic News reporter noted that in the first quarter of 2026, there was a significant policy shift—more focus on activating stock.

This shift was clearly reflected in the National Two Sessions and the “14th Five-Year Plan” outline. This year’s government work report changed the goal of real estate policies from “continue efforts to stabilize the housing market” in 2025 to “focus on stabilizing the housing market,” and for the first time proposed a “city-specific policy approach to control growth, reduce inventory, and improve supply,” reintroducing the “de-inventory” strategy after 10 years.

The “14th Five-Year Plan” explicitly dedicated a chapter to “promoting high-quality development of real estate,” divided into “improving the housing security system” and “promoting stable and healthy real estate market development,” with several practical measures added.

In terms of stock activation, local governments have increased efforts to acquire stock land.

According to incomplete statistics from the China Index Academy, as of March 29, over 5,800 cases of stock land acquisition through special bonds have been announced nationwide, covering more than 300 million square meters, with a total amount exceeding 780 billion yuan. Over 3.5 trillion yuan of special bonds have been issued, accounting for about 45%. Guangdong, Jiangsu, Sichuan, and other regions issued over 48 billion yuan in 2026, maintaining substantial issuance levels.

Another highlight of the first quarter of 2026 was the acceleration of policies supporting urban renewal.

On February 1, the Fujian Provincial Department of Housing and Urban-Rural Development issued “Several Opinions on Further Promoting Stable Development of the Real Estate Market” (Min Jian Fang [2026] No. 1), explicitly supporting self-demolition and self-construction of old and dilapidated housing.

On February 27, Shenzhen issued a notice clarifying that new old renovation projects would generally no longer be required to include affordable housing, reducing development barriers for enterprises.

On March 5, Qinghai issued the “Qinghai Province Urban Renewal Action Implementation Plan,” aiming to complete over 8 old district renovations, 150k household upgrades, and eliminate D-grade dangerous houses by 2030.

Demand-side policies are becoming more refined. This year’s government work report proposed “strengthening housing security for newly married and newly parent families, supporting multi-child families’ housing needs,” closely linking housing policies with population policies. Many regions have optimized housing provident fund policies, expanded their scope, supported cross-region recognition and loans, and increased subsidies for specific groups.

On March 30, China Resources Land’s management team told media including the Daily Economic News that the industry’s most difficult period has passed, and it has officially entered a cycle of bottoming out, recovery, and deep differentiation. Policy support is currently “moderate,” with considerable room for future efforts.

Huatai Securities’ research report stated, “The bottom of the real estate market is gradually becoming clear.” Its core argument is that: the secondary market is experiencing the strongest “small spring” in three years, and the industry is entering a bottoming and stabilizing phase.

Cao Jingjing, General Manager of the Index Research Department at the China Index Academy, analyzed that city-specific policies remain the main focus, and housing policies are expected to better integrate with population policies, strengthening support for newly married, newly parent, and multi-child families. “In the first quarter of 2026, core cities’ real estate markets have shown spot repairs, with secondary markets outperforming new homes. In the second quarter, with the peak season and good properties entering the market, the recovery is expected to continue, and the market will remain in the bottoming phase throughout the year,” Cao said.

The Daily Economic News