Core Viewpoint - The notion that collective resistance to buying homes will lead to a significant drop in housing prices is overly simplistic and does not hold true in the current market context. The real estate market is influenced by multiple factors, including regional dynamics, financial stability, and government interests. Group 1: Market Dynamics - Housing prices are determined by a variety of factors, and consumer resistance alone cannot significantly impact market trends [3] - The real estate market exhibits regional and hierarchical characteristics, with significant differences in performance across cities [3] - In major cities like Beijing, Shanghai, Guangzhou, and Shenzhen, housing demand remains strong due to population inflow, while smaller cities face greater pressure due to population outflow [3][4] Group 2: Financial Implications - As of March 2025, the balance of real estate-related loans in China was approximately 52.7 trillion yuan, accounting for 26.3% of total loans, indicating the sector's importance to financial stability [4] - A 30% drop in housing prices could lead to about 15% of mortgages facing negative equity risk, posing systemic financial risks [4] - Banks are likely to manage risks by supporting developers rather than allowing bankruptcies that could lead to price collapses [4] Group 3: Government and Local Interests - Local governments have a strong interest in maintaining stable housing prices due to their reliance on land sales for fiscal revenue, which accounted for over 30% of local government income in 2024 [6] - The dependence on land finance means that local authorities will actively intervene to prevent significant price declines [6] Group 4: Market Trends - The real estate market is expected to experience further differentiation, with about 50 cities maintaining active markets while nearly 200 may face prolonged adjustments [7] - The industry is transitioning from a "high turnover" model to a focus on quality and service, with a reported 5.2 percentage point decrease in average debt ratios among the top 100 real estate companies [9] - The housing rental market is projected to grow rapidly, with an expected market size of 3 trillion yuan by 2030, reflecting changing consumer preferences [10] - The existing housing market will become increasingly dominant, with second-hand transactions expected to exceed new home sales, accounting for over 55% of total housing transactions [11]