Beijing’s crackdown on the once-hot property market has focused on financial risks of speculation and highly indebted developers such as Evergrande. Despite recent government efforts, home sales have slumped as the overall economy slows.
This week, a meeting of top Chinese leaders noted a “great change” in the relationship between supply and demand in the real estate market — and called for policy adjustments. That’s according to a CNBC translation of the Chinese readout of a Politburo meeting on Monday.
The readout also removed the phrase “houses are for living in, not for speculation” — frequently used in China as a mantra for a tight policy on the property market.
“For policymakers, the top property-related risk is no longer financial risk, but recession risk,” said Larry Hu, chief China economist at Macquarie.
The first time Chinese officials spoke of changes in real estate supply and demand was at a People’s Bank of China press conference on July 14, according to a state media report. Then, the PBOC official hinted at forthcoming property market policies.
This week, the higher-level Politburo meeting readout included similar language.
The Hang Seng Property Development and Management Index rose by 9.78% on Tuesday. State media indicated relaxation in purchase restrictions could come later this year for China’s smaller cities.
