China housing slump to continue into 2025, says ex-PBOC official

CHINA’S property downturn may continue for two more years before gaining stability, according to a former central bank official.

New-home sales nationwide will likely shrink by another 50 million square metres (sq m) both this year and next year, with 2025’s annual total plateauing at around 850 million sq m, Sheng Songcheng, a former director of the People’s Bank of China’s statistics and analysis department, said at a forum in Shanghai on Saturday (Jan 13). The battered industry will stop being a drag on investment and economic growth after that, he added. 

Sheng’s comments came as the slide in Chinese home sales accelerated in December, even after the authorities rolled out more support measures that included relaxing homebuying curbs in major cities. The country’s unprecedented housing slump has cost the economy a key growth engine in the past three years and heightened financial risk following a record wave of defaults by developers. 

The property market saw green shoots in November and December, putting full-year nationwide sales at around 950 million sq m, Sheng said. That would mean the pace of sales decline moderated by a half in 2023 from a year earlier, according to Sheng’s estimates. BLOOMBERG