The rating agency Standard & Poor's has published a report, predicting that next year the decline in real estate sales in mainland China will significantly narrow to 5% to 10%, with total sales expected to be between 8.7 trillion and 9.2 trillion yuan. Among them, the growth rate of real estate sales in upper-tier and lower-tier cities will show significant differentiation.

S&P anticipates that China's GDP growth rate will reach 4.1% in 2025, and the slowing economic growth will pose certain challenges to residents' willingness and ability to purchase homes, combined with demographic factors affecting housing demand. S&P also pointed out that commodity housing prices in first and second-tier cities are expected to stabilize in 2026, but before stabilizing, there is still a 5% to 8% decline space; as for third-tier cities and below, sales volume and prices will continue to decline in 2025, with a sales decline of approximately 15%.

S&P believes that the supply-demand imbalance in lower-tier cities remains an important constraint on the overall stabilization of the mainland real estate market. Issues such as insufficient regional demand, the siphoning of purchasing power from upper-tier cities, and the slow progress of storage and landing make it very difficult to significantly reverse the current situation. (js/u)

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