Core Viewpoint - The real estate market in northern China is experiencing significant price declines, with various cities reporting substantial drops in housing prices, reflecting broader economic and demographic challenges [1][3][4]. Group 1: Housing Price Trends - In December 2024, new residential prices in northern cities showed notable declines, with Harbin down 8.2%, Changchun down 6.8%, and Shenyang down 5.9% year-on-year [1][3]. - The average new home price in Shenyang in December 2024 was approximately 9,500 yuan per square meter, representing a 20% decrease from the peak in 2022 [4]. Group 2: Demographic and Economic Factors - The population outflow in northeastern provinces has exceeded 11 million over the past decade, leading to decreased housing demand [3]. - Economic performance in traditional heavy industrial cities is struggling, with Daqing's GDP declining by 2.1% and Anshan's growth at only 1.8%, which does not support rising housing prices [3]. Group 3: Market Dynamics - The sales area of new residential properties in Tianjin fell by 15.2% in 2024, indicating a significant market contraction [3]. - The inventory turnover period for Shenyang's residential properties reached 18 months, exceeding the reasonable level of 12 months, signaling a deep adjustment in the market [3]. Group 4: Buyer Sentiment and Behavior - Buyer sentiment has shifted from investment-driven purchases to a focus on residential needs, with a 35% decrease in viewing activity in northern cities compared to the same period in 2023 [3][4]. - First-time homebuyers are finding opportunities in the current market, while investors are facing challenges due to high mortgage pressures and stagnant sales [4][6]. Group 5: Impact on Financial Institutions and Local Economies - Banks are tightening lending conditions despite lower mortgage rates, with longer approval times and stricter income verification requirements [6]. - Land transfer revenues in northeastern provinces dropped by approximately 40% in 2024, impacting local government finances and infrastructure projects [6]. Group 6: Emerging Trends and Future Outlook - The rental market is stabilizing, with rental yields increasing, as demand for rentals remains steady amidst declining home purchases [6]. - New business models such as long-term rentals and shared living spaces are emerging, injecting vitality into the market [8]. - The real estate market is expected to continue adjusting in the short term, with a gradual stabilization anticipated as economic structures evolve and population flows stabilize [7][10].