China’s Housing Market Deepens Slump Amid Urban Support Efforts

China’s Housing Market Faces Deeper Downturn Despite City-Level Interventions

China’s residential property sector experienced a more pronounced decline in September 2025, with home prices falling at an accelerated rate. This downturn occurred despite concerted efforts by several major cities to implement supportive measures aimed at revitalizing the struggling market. The latest data underscores the persistent challenges facing China’s real estate, a critical pillar of its economy.

Accelerating Price Declines Across Key Cities

According to official statistics, new-home prices across 70 major cities, excluding state-subsidized housing, saw a 0.5% month-over-month decrease in September. This figure represents a notable acceleration from the 0.3% decline recorded in August. On an annual basis, prices plummeted by 3.8%, marking the steepest year-on-year drop since December 2015. This consistent downward trend highlights the severity of the market’s contraction, impacting both developer confidence and consumer purchasing power.

Existing home prices also mirrored this negative trajectory, falling by 0.8% month-over-month in September, an increase from August’s 0.6% decline. Year-on-year, second-hand home prices were down 6.2%, indicating broad-based weakness across the housing spectrum.

Top-Tier Cities Expand Easing Measures

In response to the ongoing slump, several of China’s most economically significant cities have intensified their efforts to stabilize the market. Shanghai and Shenzhen, two of the nation’s premier economic hubs, recently expanded their easing policies. These measures include reducing down-payment requirements for homebuyers and lowering mortgage rates, making homeownership more accessible and affordable.

Guangzhou, another key metropolis, had previously implemented similar relaxation policies. These actions by tier-one cities are particularly significant given their economic weight and influence on national market sentiment. The hope is that by stimulating demand in these crucial urban centers, a ripple effect might eventually spread to other regions.

Broader Economic Context and Policy Implications

The persistent decline in home prices comes at a challenging time for China’s economy. The property sector, historically a significant contributor to GDP, has been grappling with a debt crisis among major developers, leading to unfinished projects and a crisis of confidence. The government has been walking a tightrope, aiming to deleverage the sector while preventing a systemic financial crisis.

Policymakers have introduced a series of measures throughout 2025, ranging from financial support for developers to incentives for homebuyers. However, the September data suggests that these interventions have yet to yield a significant turnaround. The effectiveness of current policies is under scrutiny, and there is growing anticipation for more substantial, potentially nationwide, stimulus measures.

Key Takeaways

• Accelerated Price Drops: China’s new home prices fell 0.5% month-over-month in September, with a 3.8% year-on-year decline, the steepest in nearly a decade.
• Widespread Weakness: Existing home prices also saw significant monthly and annual drops, indicating a broad market contraction.
• City-Level Support: Major cities like Shanghai and Shenzhen have expanded easing measures, including reduced down payments and lower mortgage rates.
• Policy Challenge: Despite these efforts, the market continues to struggle, putting pressure on policymakers to consider further interventions.

Conclusion

The deepening slump in China’s housing market in September 2025, despite targeted support from top-tier cities, underscores the complex and entrenched challenges facing the sector. While local governments are actively trying to inject vitality, the latest figures suggest that current measures may not be sufficient to reverse the downward trend. The coming months will be crucial as observers watch for potential broader policy shifts from Beijing, which could include more aggressive fiscal or monetary easing to stabilize this vital segment of the Chinese economy and restore investor and consumer confidence.