Residential buildings are pictured in Shanghai, China, on Sep 29, 2024. (Photo: REUTERS/Tingshu Wang)

China pledges to step up urban renewal, stabilise housing market in 2026

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BEIJING: China will step up urban renewal and efforts to stabilise its property market in 2026 at the ⁠start of its latest Five-Year Plan (2026-2030), according to a readout of a housing policy conference released on Tuesday (Dec 23).

The conference, held in Beijing on Dec 22-23, mapped out key housing development tasks for the Five-Year Plan period, and called next year a critical starting point for policy implementation, according to the readout published ‍by the housing ministry's official outlet.

A ⁠major ‍focus will be the "vigorous implementation of urban renewal", alongside efforts to stabilise the real estate market, prevent and defuse risks and improve the supply ⁠of affordable housing.

China's property sector, once a key engine of growth, has been in persistent decline since mid-2021, ‍despite repeated government pledges to shore up the sector. Weak home sales and falling prices have weighed on consumer confidence and homeowners, with around 70 per cent of household wealth tied to real estate.

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Developers have also faced liquidity strains. China Vanke said in a filing on Monday it had won approval to extend the grace period for a 2 billion yuan (US$284.2 million) bond repayment due ‌on Dec 15.

On market stabilisation, officials said policies would be tailored to local conditions to manage supply and reduce inventories. Measures include renovating ‍urban ‌villages and supporting local governments in purchasing existing homes for use as affordable housing.

Officials also said China would push a shift toward selling finished new homes, so "buyers can see what they are getting".

The conference pledged to strengthen the "project whitelist" mechanism, a government-backed programme under which local officials nominate stalled residential projects for expedited bank financing, and ‌urged city governments to make full use of their discretion to adjust and optimise property policies.

On risk control, officials said they would follow market-oriented and the rule of law to address developers' debt risks, tighten oversight of presale funds and protect homebuyers' legitimate rights and interests.

On affordable housing, officials said they would seek to provide housing support for low-income urban households facing difficulties, while adopting targeted measures to meet the basic housing needs of vulnerable groups, including young people. 

Source: Reuters/ec

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