Core Insights - The real estate market is not just a business for developers but is deeply intertwined with the lives of millions, affecting employment, consumption, and social stability [1][12] - A prolonged downturn in the housing market could lead to significant social issues, impacting employment, pensions, and consumer confidence [1][12] Employment Impact - The construction industry has seen a decline in employment, with numbers dropping from 65 million at peak to 59 million in 2025, leading to reduced income for workers [3] - The renovation sector is also struggling, with a reported 60% decrease in orders for renovation workers, causing financial strain on families [3] - The downturn is affecting related industries, including finance and logistics, with over 20,000 real estate agencies closing in 2025 [3] Pension and Social Services - Land sales revenue, crucial for funding social security and pension systems, has decreased by over 20% in 2025, putting pressure on pension funds [5] - Some regions are experiencing a tightening of funds for elderly care services, leading to cuts in community programs and support [5] - The decline in land revenue may also affect the quality and availability of public services, including education and healthcare [9][10] Consumer Confidence and Spending - With 77% of household wealth tied to real estate, falling property values are leading to a decrease in consumer confidence, reflected in a -37.6% housing confidence index [8] - Retail sales growth has slowed by 2.3 percentage points, particularly in major consumer categories like home appliances and automobiles [8] - Families are cutting back on both large and everyday expenses, leading to a cycle of reduced spending and economic stagnation [8] Public Services and Infrastructure - The decline in land revenue is causing a slowdown in infrastructure projects, with many planned developments being postponed or canceled [9] - Public services, including education and healthcare, are facing budget cuts, resulting in a decline in service quality and availability [9][10] Long-term Economic Outlook - The ongoing real estate downturn is eroding public confidence and could stifle economic growth, affecting investment and entrepreneurship [12] - A shift away from reliance on land finance is necessary, with a focus on developing rental markets and new economic growth sectors [13] - The stability of the housing market is crucial for the overall well-being of ordinary citizens, emphasizing the need for timely policy interventions [13]