Many regions implement optimization measures after the holiday to stimulate the real estate market vitality

Our reporter Zhang Xiangyi

On February 25, five departments including the Shanghai Municipal Housing and Urban-Rural Development Management Committee jointly issued the “Notice on Further Optimizing and Adjusting the City’s Real Estate Policies” (hereinafter referred to as the “Notice”) to promote the steady and healthy development of the real estate market.

The “Notice” involves policy adjustments in multiple areas such as housing purchase restrictions, housing provident funds, and personal property taxes, benefiting various housing groups and stimulating housing demand.

After the Spring Festival, several cities including Shanghai, Huai’an in Jiangsu, and Guiyang in Guizhou have introduced policies to optimize the real estate sector. By making full use of tools like housing provident funds and purchase subsidies, these measures aim to better meet residents’ rigid and improved housing needs.

The “Notice” clearly states that housing purchase restrictions will be further eased. Specifically, for non-Shanghai residents or single adults, if they have paid social insurance or personal income tax in the city for at least one year before purchasing a home, they can buy unlimited units outside the outer ring road, but are limited to one unit inside the outer ring. For those who have paid social insurance or personal income tax for three years or more, they are limited to two units inside the outer ring.

“These tiered easing strategies precisely match Shanghai’s customer structure and housing needs, effectively accommodating market demand and improving supply,” said Zhang Bo, President of 58 Anjuke Research Institute. Data from 2025 shows that the overlap between new and second-hand housing buyers in Shanghai is only 8.7%, the lowest nationwide, indicating a stable pattern of “new homes for improvements and second-hand homes for rigid demand.” The reduction of social insurance or personal income tax payment requirements inside the outer ring to one year specifically lowers the barrier for new residents and talents to buy their first home, aligning with the dominant demand for second-hand housing.

Zhang Wenjing, General Manager of Shanghai Data at the China Index Academy, believes that this adjustment continues the trend of gradual and refined policy changes, focusing more on the inner side of the outer ring, which directly expands the housing demand group within the outer ring. This is likely to have a more noticeable effect on stimulating the inner market. Since the second-hand housing market inside the outer ring has a larger share, the policy will have a more positive impact on stabilizing second-hand home prices.

Additionally, the “Notice” optimizes housing provident fund loan policies by increasing the maximum loan amount, refining the criteria for loan units, and expanding support for multi-child families purchasing homes. These measures aim to leverage the housing provident fund to support housing consumption and meet residents’ needs for comfortable living at different stages.

The maximum loan amount for first-time homebuyers using the housing provident fund has been raised from 1.6 million yuan to 2.4 million yuan. Coupled with policies allowing up to a 35% increase for multi-child families and green building purchases, the maximum loan in Shanghai can reach 3.24 million yuan.

“After Shanghai’s policy adjustments, the ratio of the first home loan amount to the median total price of new homes will approach 50%, which will better support homebuyers, reduce purchase costs, and increase housing consumption willingness and capacity,” said Zhang Wenjing. She added that there is still room for further optimization of the down payment ratio and scope of housing provident fund use to further support housing consumption.

Li Yujia, Chief Researcher at the Guangdong Housing Policy Research Center, believes that Shanghai’s early implementation of these policies signals clear efforts to reduce costs, lower thresholds, and boost market expectations. The targeted policies will significantly drive the “small spring” market rebound in March.

Currently, promoting active release of housing demand and balancing supply and demand in the real estate market are key policy directions in many regions. Many localities are releasing favorable policies, including purchase subsidies and optimized housing provident fund policies.

Regarding purchase subsidies, on February 24, Huai’an announced the “Five Measures to Promote Healthy Development of the Real Estate Market” (hereinafter referred to as the “Measures”), which include subsidies for purchasing new commercial housing, corporate group-buying talent housing, and elder care housing.

The “Measures” specify that a subsidy of 2% of the total purchase price will be given for buying new commercial housing. For new residents in Huai’an (those without local household registration or with less than 10 years of local employment), a subsidy of 3% of the total purchase price will be provided.

In terms of housing provident fund policies, Guiyang announced on February 24 the “Implementation Measures for Commercial Personal Housing Loans to Transition to Housing Provident Fund Personal Loans,” regulating the management of “commercial to public fund” loan conversions and supporting residents’ rigid housing needs.

“Currently, including Shanghai, the focus of housing policies across regions is on unlocking demand potential,” Li Yujia said. Under the combined influence of policy support, developer promotions, and seasonal peak periods, the housing market in March may see a small peak. The key for April and May is whether the March market can, with policy support and improved expectations, create a healthy cycle of selling old homes and buying new ones.

Zhang Wenjing stated that with more policies coming into effect, Shanghai’s real estate market is expected to stabilize and recover first, playing a leading role in boosting overall market confidence. She also predicts that Shenzhen will further optimize its real estate policies to further stimulate market confidence.

(Edited by: Wenjing)

Keywords: Housing Market