China economic focus August 2023: policy flop fails property market

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China's property market has been in recession since late 2021 but supportive measures so far have failed to revive it. Home buyers lack confidence in either property or the overall economy and are reducing their exposure to the property sector. Relaxing the housing policy in tier 1 cities could prove a fillip for property developers. However, it will only have a marginal impact on demand for construction-related commodities. The current recession will stabilise in 2024 but the negative impact on commodity demand could last until 2026. Over the medium term, slowing urbanisation means property completions will trend downwards.

Table of contents

  • Executive summary
  • Supportive measures fail to revive China's property market
  • Unintended consequences of lower interest rates
  • Room for further relaxing of home purchase restrictions
  • Property completions will trend down
  • Appendix

Tables and charts

This report includes 15 images and tables including:

  • Mortgage rate dropped since 2022
  • Outstanding mortgage loans dropped while consumer loans increased
  • New home sales, Nanjing
  • New home sales, Shaoguan
  • Newly urbanised population
  • Urban housing completion
  • Wood Mackenzie's proprietary China data
  • Manufacturing PMI
  • Industrial production and retail sales
  • Trade
  • Inflation
  • Investment
  • Property
  • Money supply (M2)
  • Required reserve ratio

What's included

This report contains:

  • Document

    China economic focus August 2023: policy flop fails property market

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