On March 16th, the Shenzhen Housing Provident Fund Management Committee released two documents that adjusted and optimized the housing provident fund loan and interest subsidy policies, which will take effect from March 24th. Among them, the maximum loan amount for families is raised to 2.31 million yuan, while individuals can borrow up to 1.26 million yuan.

Shenzhen has also removed the household registration and first-time home restrictions on out-of-town housing provident fund loans. After the adjustments, out-of-town employees can apply to the Shenzhen Housing Provident Fund Center for housing provident fund loans (including commercial loan conversions) when buying a first or second set of commercial housing in Shenzhen, regardless of whether they have Shenzhen household registration, as long as they meet the requirements for housing provident fund loans in Shenzhen.

In addition, Shenzhen has increased the maximum loan amount from the original account balance multiplier of 14 times to 16 times, while not exceeding the maximum limit. The documents also clarify that families with multiple children who use housing provident fund loans to purchase a second set of commercial housing can apply the policies for the first set of housing provident fund loans.

Recently, both at the central and local levels, bullish policies for the real estate market have been continuously emerging. Research institutions point out that this will effectively boost market confidence, and the main tone of "stabilizing after declining" in real estate remains unchanged.

Families can borrow up to 2.31 million yuan! Shenzhen has increased the housing provident fund loan limits.

On March 16th, the Shenzhen Housing Provident Fund Management Committee issued two documents, "Supplementary Regulations on the Management of Housing Provident Fund Loans in Shenzhen" and "Notice on Matters Related to Interest Subsidies for Housing Provident Fund in Our City," adjusting and optimizing housing provident fund loan and interest subsidy policies, aiming to better meet the housing demands of employees and enhance the protective role of the housing provident fund system. The two documents will take effect on March 24, 2025.

The documents propose to adjust the maximum (basic) limits, raising the maximum limit for individual applications from 0.5 million yuan to 0.6 million yuan; and the family application maximum limit from 0.9 million yuan to 1.1 million yuan.

Adjust the maximum limit for increases and ratios. The increase ratio for purchasing the first home in Shenzhen has been raised from 20% to 40%. The increase ratio for families with multiple children has been raised from 10% to 50%. This policy applies to families with two or more children, counting both minor and adult children. Adult children with national housing fund loan records are not included. A new increase scenario for purchasing this city's affordable housing has been added, with an increase ratio of 20%. Additionally, multiple increase scenarios can be combined, with a maximum increase of 110%, meaning individuals can borrow up to 1.26 million yuan, and families can borrow up to 2.31 million yuan. Based on past data, the first home increase policy can cover over 90% of loan applications from workers.

The document also raises the loan limit for housing provident fund loans from 14 times the original account balance to 16 times, while not exceeding the aforementioned maximum limit. The loan limit also needs to take into account the worker's repayment ability, repayment term, and other factors for comprehensive calculation, with the final amount subject to the approval results. This adjustment will further protect low to middle-income families and young individuals with shorter work tenures, enhancing their ability to secure housing provident fund loans.

To fully meet workers' rigid and diversified housing improvement needs, with a focus on supporting workers to purchase affordable housing, the document specifies the adjustment of the minimum down payment ratio for housing provident fund loans in Shenzhen.

If employees apply for a combination loan of Housing Provident Fund and commercial housing, the minimum down payment ratio will follow the higher one of the two.

The document specifies that families with multiple children, if using housing provident fund loans to purchase a second set of commodity housing, may enjoy the first home housing provident fund loan policy, which involves two main aspects: 1. Preferential interest rates for first home loans can be enjoyed; 2. A policy with a maximum loan amount increase of 90% can be accessed. Among them, the first home increase is 40%, while the increase for families with multiple children is 50%. This policy applies to families with two or more minor children, excluding adult children.

Shenzhen has also removed the household registration and first home restrictions for housing provident fund loans from other places. Before the adjustment, workers with household registration in Shenzhen and purchasing their first home could apply for loans from the Shenzhen Housing Fund Center. After this adjustment, workers from other regions can apply for housing provident fund loans (including commercial conversion loans) at the Shenzhen Housing Fund Center when purchasing their first or second commodity housing, regardless of whether they have Shenzhen household registration, as long as they meet the loan conditions.

The document clarifies that the interest subsidy for housing provident funds will be strengthened. Since December 2012, Shenzhen has implemented an interest subsidy policy for housing provident funds, where workers who have contributed for one year and have not used housing provident loans can, in addition to receiving interest on their contributions at the national stipulated rate during the contribution period, also enjoy extra interest subsidies upon account closure. The subsidy amount is calculated as total interest accrued over the years (including account closure interest) multiplied by the subsidy ratio. To fully leverage the safeguarding role of the housing provident fund system and better benefit contributing workers, the "Interest Subsidy Notification" has increased the subsidy ratio: for 1 year ≤ cumulative contribution years < 5 years, the subsidy ratio is raised from 5% to 10%; for 5 years ≤ cumulative contribution years < 10 years, it is raised from 8% to 15%; and for cumulative contribution years ≥ 10 years, it is raised from 12% to 20%.

It is worth noting that the second-hand housing market in Shenzhen has recently continued to warm up, with the recorded volume having increased for five consecutive weeks. According to Shenzhen Real Estate Brokerage Association, in week 10 of 2025 (March 3 - March 9), there were 1,812 recorded second-hand homes (including self-service), an increase of 11.6% compared to the previous week. Recently, the second-hand housing market has continued to warm, with recorded volumes rising for five consecutive weeks, and consumers' willingness to purchase homes continues to strengthen, exceeding 1,800 units in a single week.

Good policies continue to emerge.

Recently, there have been significant news in the Real Estate sector. Institutions point out that a series of policies from both the central and local governments will effectively boost market confidence and promote the activity level of transactions in the Real Estate market. Currently, the main tone of 'stopping the decline and stabilizing' in Real Estate remains unchanged.

At the central level, the 2025 "Government Work Report" proposed to continuously push for the stopping of declines and stabilization in the Real Estate market. Policies should be tailored to cities to reduce restrictive measures, intensify the implementation of the renovation of urban villages and dilapidated houses, and fully release the potential of rigid and improvement housing demand. Optimize the urban spatial structure and land use methods, and reasonably control the supply of new Real Estate land. Activate existing land and commercial office properties, promote the acquisition of existing Commodities, and grant greater autonomy to city governments regarding acquisition targets, prices, and uses. Broaden the scope of secured housing refinancing. Utilize the coordination mechanism of Real Estate financing to continue ensuring the delivery of houses, effectively preventing debt defaults by property companies. Methodically establish relevant foundational systems and accelerate the creation of a new mode of Real Estate development. Adapt to the high-quality housing needs of the public, improve standards and specifications, and promote the construction of safe, comfortable, green, and smart 'good houses.'

Additionally, on the afternoon of March 9, the Minister of Housing and Urban-Rural Development, Ni Hong, stated that the ministry would work with relevant departments to maintain a combination of short-term and long-term measures, firmly stabilizing the housing market. The focus will be on four tasks: 1) consolidate the effects of policy combinations; 2) strive to implement renovations of urban villages and dilapidated houses; 3) promote the acquisition of existing Commodities; 4) reform and improve fundamental systems for Commodity development, financing, and sales.

Ni Hong indicated that the government work report proposed this year for local governments to arrange special bonds amounting to 4.4 trillion yuan, one use being for land acquisition and the purchase of existing Commodities. This will support localities in fully exercising their autonomy regarding the acquisition targets, prices, and uses, with acquired Commodities prioritized for affordable housing, resettlement properties for urban village renovations, talent housing, youth apartments, and staff dormitories. Regarding urban village renovations and the improvement of dilapidated houses, Ni Hong noted that on the basis of adding 1 million units last year, the renovation scale will continue to expand steadily, pushing for monetized resettlement, allowing residents of urban villages more choices, achieving early occupancy and settlement while also helping to digest existing Commodities.

At the local level, the special bonds for renovation and land acquisition are accelerating implementation. On February 18, Beijing issued a batch of local government bonds, including 10.1 billion yuan in general bonds and 46.29 billion yuan in special bonds. The special bonds are designated for a total of 85 urban construction projects in districts such as Chaoyang, Haidian, and Fangshan, with raised funds primarily directed towards shantytown renovations, urban village renovations, land reserves, and municipal and industrial park infrastructure projects. The repayment funds mainly come from land transfer revenue and resettlement housing sales revenue. Additionally, on February 23, Guangdong Province announced a quota of 30.7 billion yuan in special bonds, specifically for land reserves and the recovery of idle existing land, making Guangdong the first province in the country this year to implement special bond funds to recover idle existing land. China Bank International Securities predicts that with the advancement of special bonds in Guangdong, the land acquisition special funding policies will continue to improve this year, and breakthroughs regarding special bond acquisitions of existing land and special loans may be achieved.

Additionally, Chongqing has lifted transaction restrictions (cancelling the re-trading management of previously restricted housing in the central urban area that had been under a two-year limit), and optimized property tax collection policies (improving the pilot policy for personal housing property tax, no longer taxing ordinary housing purchases by out-of-city individuals). Shandong, Dalian, Chengdu, and other areas are optimizing housing fund policies.

On March 11, the Ministry of Natural Resources and the Ministry of Finance issued a notice regarding the use of local government special bonds to support land reserves. HTSC predicts that the continued issuance of regulatory documents is expected to provide local governments with clearer operational guidelines, accelerate the implementation of special bond land acquisition, thus balancing land supply and demand, improving the liquidity of property companies, and further solidifying the trend of 'stopping the decline and stabilizing.' The advancement of land acquisition policies is expected to further improve the inventory issue of Real Estate, Bullish on the recovery of volume and price in key urban area markets, as well as the valuation recovery of 'excellent' property companies that have reserves or newly acquired resources in relevant areas, while property management companies with robust performance and cash flow are also expected to benefit from the market's stabilization.

BOCI Securities stated that the main tone of the current Real Estate market has "stopped declining and stabilized," and boosting demand is the primary task. From high-frequency data, the market is still maintaining a slow recovery momentum.

Whether the subsequent market recovery can be solidified depends on the further expansion of loose policies on the demand side and the continued progress of monetizing old reforms and reserves, which will remain an important theme in 2025.

From the perspective of symbols, on one hand, real estate companies that are safe in liquidity, heavily invested in high-energy cities, and have outstanding product strength may have more α attributes; on the other hand, symbols that benefit from debt resolution, policy relief, and sales improvement under multiple logics of reversal from difficulties may have greater valuation repair elasticity.

At this stage, it is recommended to focus on four main lines: 1) Companies with stable fundamentals that have high sales and land reserve ratios in core first and second-tier cities, and relatively high market shares in key cities; 2) "Small and beautiful" real estate companies that have made significant breakthroughs in sales and land acquisition since 2024; 3) Real estate companies with increases or changes in operations or strategies and companies benefiting from local government debt resolution logic; 4) Real estate brokerage companies benefiting from the continuous quantity and price recovery in the second-hand housing market.

Editor/Somer