(Source: "China Economic Times"-China Economic News Network, July 14, 2025)

To stimulate the potential of home purchase, both supply and demand sides need to work together. On the one hand, it is necessary to further optimize the supply structure of the real estate market and meet different levels of living needs by improving the affordable housing system and increasing the supply of high-quality housing. On the other hand, efforts should be made to improve residents' ability to purchase houses, and enhance families' affordability and confidence through measures such as stabilizing employment, improving income expectations, and lowering the threshold for purchasing houses.

Our reporter Li Xiaohong

Since last year, against the background of the continuous efforts of a series of policies to stabilize the property market, the real estate market has been undergoing in-depth adjustments, and some rigid and improved needs have been released. However, due to multiple factors such as high home purchase costs, lack of market confidence, and structural imbalances in supply and demand, the recovery in home purchase demand has been weak. How to effectively lower the threshold for home purchase, improve market expectations, and stimulate the vitality of home purchase demand has attracted much attention.

The vitality of demand for home purchases needs to be further stimulated

“Currently, I choose to rent a house. Although my income has increased significantly compared with when I first entered the workplace, housing prices are still high in first-tier cities. Coupled with the lack of job stability and the uncertainty of income expectations, I dare not "I have put all my savings into buying a house, so I have no plans to buy a house at the moment." Zhang Rong has been in Beijing for eight years. She told the China Economic Times reporter that it is quite difficult for most young people to pay the down payment for a house after working for several years. Even if they consider buying a house, they have to worry about the risk of being unable to continue making payments due to unemployment.

Yu Yu, born in the 1990s, is also renting a house. She has been working in Beijing for ten years and has postponed her plan to buy a house indefinitely. "Although I have the ability to pay a certain down payment, I can only choose a house that is 'old and small' or 'far and large'. In addition, considering that my parents are getting older, I also need to maintain a certain amount of savings to deal with possible emergencies." Yu Yu said that she plans to work and live in Beijing for a long time in the future, and there is indeed a need to buy a house, but the decision to buy a house must be based on her own actual situation.

Young people like Zhang Rong and Yu Yu, as first-time home buyers, are usually in critical stages of life such as marriage and childbirth, and have an urgent need to buy a home. However, they generally have shorter working years, limited savings, and higher sensitivity to home purchase costs. Therefore, income has become a key factor affecting their home purchase decisions.

Li Mu represents the needs of improvement-oriented home buyers. He pays more attention to the comfort of living and has higher expectations for the housing area, unit design, lighting and ventilation, community environment and property services. He hopes to live in a high-quality community with complete supporting facilities. "We hope to improve the living environment, but this must be achieved through the method of 'selling old and buying new'. Currently, our house has been listed by an agency for more than half a year. The problems we face are that the transaction cycle is too long and the price discount is too large, which makes our replacement plan have to be temporarily shelved." Li Mu said.

Rigid demand and improvement demand are the two pillars of the real estate market, but the release rate of these two demands is currently slowing down significantly. Although policies continue to optimize home purchase conditions, the wait-and-see attitude of home buyers does not seem to have significantly improved.

In interviews, China Economic Times reporters found that many potential home buyers have become cautious about their income growth expectations and lack confidence in future disposable income growth. Therefore, they are extremely cautious when making a major consumer decision such as home purchase. In addition, the expectation of falling house prices has led to some people's mentality of "buying up but not buying down", further deepening the wait-and-see mood. Many homebuyers are concerned that the value of their property will decline after purchasing a home, so they choose to postpone their home purchase plans.

Zhang Rong said that since she cannot settle down in Beijing, buying a house will not give her the sense of stability of "taking root in Beijing", and buying a house will make her more constrained and financially pressured when she changes jobs or chooses a different lifestyle. At the same time, more and more young people want to experience life, do not want to be bound by a house, and pursue lifestyle changes and spiritual enrichment.

Wang Ruimin, associate researcher at the Development Research Center of the State Council, told a China Economic Times reporter that after four years of adjustments and bottoming out, housing prices have fallen back to a reasonable range. Overall, investment demand for "speculation" has basically faded away, while consumer demand for "living" has gradually increased. However, compared with "renting", a low-cost and flexible living solution, "purchasing" is still much more expensive. The requirements for payment ability and willingness to pay are relatively high, and new motivations are not enough. Especially for potential ordinary home buyers such as new citizens, the problem of lack of initial accumulation of funds and insufficient payment ability is still more prominent, especially in large cities with a net population inflow.

Liu Zhengshan, deputy secretary-general of the China Urban Development Research Association, said in an interview with a reporter from China Economic Times that the demand for home purchases appears to be insufficient to some extent. To explore the reasons, first of all, the debt problems of some real estate companies have triggered concerns about unfinished properties; at the same time, employment instability during the economic transition period has weakened people's long-term home buying confidence. Secondly, the increase in the supply of affordable housing has diverted some of the basic housing demand, while the high down payment ratio and transaction taxes for second homes have suppressed improvement demand to a certain extent. Third, the dual pressures of high housing prices and loan thresholds still exist. Fourth, the connection of public services needs to be further improved. Finally, in terms of policy implementation, there are large differences in policies across regions. Innovative measures such as mutual recognition of provident funds in different places and shared property housing are not popular enough, and the coordination of policies needs to be strengthened.

Multi-dimensional efforts to activate home purchase potential

To stimulate the potential of home buying, both supply and demand needs to work together. On the one hand, it is necessary to further optimize the supply structure of the real estate market and meet different levels of living needs by improving the affordable housing system and increasing the supply of high-quality housing. On the other hand, efforts should be made to improve residents' ability to purchase houses, and enhance families' affordability and confidence through measures such as stabilizing employment, improving income expectations, and lowering the threshold for purchasing houses.

How to solve this dilemma of home purchase demand? Wu Yingjie, a researcher at the Japan Research Center of the National Institute for Opening-up at the w88 casino (Beijing), believes that first of all, further lowering mortgage interest rates and increasing real estate credit lines will ensure that home buyers can successfully obtain loans. Secondly, gradually and reasonably relax the qualification review standards for home buyers, so that people with weaker qualifications who are willing to buy homes can obtain mortgage qualifications, thus expanding the home buying group.

Liu Zhengshan said that to further stimulate the demand for home purchases, the first is to activate demand in precise layers. Targeted home purchase subsidies are issued to new citizens, families with multiple children and other groups, and financial subsidies or tax deductions can be given based on a certain proportion of the total home purchase price; core cities increase the supply of small and medium-sized residential land, while third- and fourth-tier cities control the pace of land transfers to avoid inventory backlogs.

The second is to strengthen market confidence and mitigate risks. Comprehensively promote the sale of existing homes to eliminate the risk of unfinished properties on the off-plan property from the source; establish a capital supervision whitelist, provide financing support to high-quality housing companies and projects, give priority to ensuring the capital chain of "Guaranteed Delivery" projects, and enhance the trust of home buyers through government guarantees, special loans, etc.

The third is to promote the upgrading of housing quality and the simultaneous promotion of rental and purchase. Encourage the improvement of the quality of green buildings, smart homes, etc., and encourage developers to upgrade products and build good houses through tax incentives, etc.; at the same time, improve the long-term rental housing market, grant equal public service rights to renters, and form a gradient consumption model of "rent before buying" to alleviate the pressure of short-term home purchase.

In addition, optimizing the connection of public services is the key to increasing the willingness of new citizens to buy houses, especially in areas such as education and medical care, to ensure that new citizens can enjoy the same service resources as local residents. At the same time, we will promote policy innovation and regional coordination, strengthen the flexibility and adaptability of housing provident funds, taxation and other policies, and provide more convenient and inclusive support conditions for home buyers.

"To stimulate the demand for home purchases, we must take into account both short-term policy adjustments and long-term improvement of people's livelihood. In addition to formulating precise policies to break the institutional barriers for new citizens to purchase homes, we must also consolidate the demand base in areas such as employment, education, medical care, and improving urban functions and living environment." Liu Zhengshan said.

Wu Yingjie told a reporter from the China Economic Times that employment stability is the economic basis for home purchase, and a stable job can significantly improve his or her home purchase ability. Improve employment quality and income distribution, and solve the “affordability” problem. Improving revenue growth expectations can restore market confidence. The deceleration in income has led to a reduction in demand for home purchases, which requires fiscal policies to expand employment opportunities, adjust the income distribution mechanism, and increase the proportion of middle-income groups. Strengthen the balanced distribution of education, medical care, transportation and other resources to solve the "willingness to buy" motivation. In the future, it is necessary to shift from superficial stimulation to deep system optimization to indirectly increase the demand for home purchases.

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