China land sales show property market stabilizing, report says

China’s property market is showing signs of stabilizing, with land plots in key cities sold at high premiums in recent weeks, according to a report in the Economic Information Daily.

Beijing, Zhengzhou, Shenzhen and Hangzhou have recorded premiums in land auctions this year, thanks to supportive policies and improving market confidence, the newspaper said Thursday. 

That contrasts with earlier auctions that closed at low prices with little interest from developers.A residential plot in Zhengzhou, Henan province saw an 87.5 percent premium after 255 rounds of bids, the highest since 2021, according to the report.

Transactions at 35 major cities totaled 234,600 square meters by floor area during the Chinese New Year, with first-tier cities seeing a 134 percent gain from the holiday period last year, the newspaper said, citing China Real Estate Information Corp figures.

Policymakers are expected to continue measures to support the market, including optimizing land supply and boosting buyer interest, said the report, citing Yan Yuejin, vice president of Shanghai E-house’s research arm.

Chinese developers are still struggling with a debt crisis. Authorities are working on a proposal to help China Vanke (2202) plug a funding gap of about 50 billion yuan (HK$53 billion) this year, people familiar with the matter said this week, highlighting the government’s support for the distressed developer.

A separate Shanghai Securities News report showed that major cities including Beijing, Shanghai and Shenzhen are seeing land sales heat up this year. Transaction value among 300 cities rose 8 percent in January compared with last year, while the average floor price jumped 33 percent, the report said, citing data from China Index Academy.

Bloomberg