Core Insights - The China Academy of Sciences (CAS) has accurately predicted housing prices for five consecutive years, showcasing a remarkable data-driven forecasting capability [1][6][9] - In 2024, CAS forecasts a moderate increase of 3.2% in housing prices for first-tier cities, while second and third-tier cities are expected to decline by 1-3% [1][9] - The accuracy of CAS's predictions is attributed to a robust data analysis framework and a unique predictive model that incorporates various macroeconomic indicators [6][9] Yearly Breakdown - **2023**: CAS predicted a national average sales price fluctuation of around 2.4%, which was confirmed by actual market data [3] - **2022**: The prediction of a year-on-year decline in national average sales price was validated, with a decrease of 3.1% [3] - **2021**: CAS accurately forecasted a price increase of 7.8% for first-tier cities and 5.9% for second-tier cities, with an error margin of only 0.2 percentage points [4] - **2020**: Contrary to widespread pessimism due to the COVID-19 pandemic, CAS predicted a moderate increase in national average sales price, which rose by 4.2% by year-end [6] Predictive Model - The predictive model developed by CAS integrates 47 variables and is updated monthly to reflect real-time market dynamics [9] - Key factors considered in the model include population flow, land supply, monetary policy, real estate regulation, and economic growth [7][9] - Recent data, such as a 16.7% year-on-year decline in land transfer revenue in 2024, indicates increased regulatory control by local governments [9] Future Outlook - For 2025, CAS anticipates continued population movement and a concentration of homebuyers aged 25-35, alongside a persistent supply-demand imbalance [10] - The ongoing implementation of stable monetary policies and slight easing of real estate regulations are expected to influence market conditions positively [10] - CAS's consistent performance over the past five years suggests a need for a more data-driven and rational approach to understanding housing price fluctuations [10]

Core Viewpoint - The Chinese real estate market has undergone significant adjustments since 2022, with average national housing prices dropping approximately 30%, and declines in some third and fourth-tier cities exceeding 50% [1] Group 1: Current Market Conditions - The initial price corrections began in second and third-tier cities, with first-tier cities like Shanghai and Shenzhen joining the trend in 2023 [1] - Experts predict that by 2030, housing prices could increase to four to five times their current levels, driven by factors such as excessive money supply, favorable government policies, and anticipated economic growth [1] Group 2: Counterarguments to Price Predictions - The likelihood of housing prices quadrupling or quintupling in the next five years is considered extremely low due to the ongoing long-term downward trend in prices [3] - Achieving a fivefold increase in housing prices by 2030 would require annual doubling, which is deemed nearly impossible [3] - Economic growth and money supply do not guarantee rising housing prices, as the market is currently experiencing significant bubbles and investment risks [3] Group 3: Factors Supporting Price Stabilization - Residents' income levels are insufficient to support high housing prices, with many facing reduced incomes and cautious future income expectations [4] - There is an oversupply of housing in the market, with approximately 6 billion existing homes, enough to accommodate 30 billion people, leading to a long-term supply-demand imbalance [4] - The construction of affordable housing is accelerating, which will further alleviate housing supply pressures and help regulate the market [5] Group 4: Overall Market Outlook - Considering macroeconomic conditions, purchasing power, and housing supply, the potential for significant price increases in the next five years is very low, with a likelihood of continued adjustments towards rationality [6]

Group 1 - Goldman Sachs predicts that new home prices in China may decline by 20% to 25% from now until the end of 2025, with a stabilization expected by the end of 2025 [3][6] - The basis for Goldman Sachs' prediction includes a staggering debt related to real estate amounting to 59 trillion and an inventory level projected to reach 93 trillion by the end of 2024 [6] - The previous prediction by Goldman Sachs suggested that prices would not stabilize until the third quarter of 2027, indicating a rapid change in outlook within a short time frame [10] Group 2 - The current market situation shows a divergence between first-tier cities, where the market is stabilizing, and third- and fourth-tier cities, which continue to struggle with high inventory and declining prices [12][14] - In many third- and fourth-tier cities, prices have dropped by over 30%, with some areas experiencing even steeper declines, leading to a cautious sentiment among potential buyers [12] - The recommendation for potential homebuyers is to approach the market rationally, considering personal financial situations and market conditions before making decisions [14][19]

Core Insights - The article discusses potential cities for significant housing price increases in the second half of 2025, emphasizing the need for caution in predictions due to various influencing factors [1] City-Specific Analysis - **Shanghai**: The recent land auction in Yangpu District saw a premium rate of 26.3%, with floor prices exceeding 80,000 yuan per square meter, leading to expected new home prices above 120,000 yuan per square meter. The supply of new homes in 2025 is projected to be only 70% of 2024 levels, creating upward pressure on prices due to supply-demand imbalance [3][4] - **Chengdu**: The city has seen a significant increase in housing transactions, with new home sales reaching 105,000 units in Q4 2024 and a 32.9% year-on-year increase in second-hand home transactions in Q1 2025. Policy changes, including the cancellation of purchase restrictions and a reduction in down payment requirements, are expected to boost market liquidity [4][5] - **Nanjing**: The city recorded a 0.6% month-on-month increase in new home prices in December 2024, leading the nation in price growth. The land auction in early 2024 had a premium rate of 31.68%, indicating strong developer interest [5][6] - **Hangzhou**: The city led the nation in land auction revenue in Q1 2025, with premium rates between 20%-40% in certain districts. The influx of high-income individuals due to industrial upgrades is driving housing demand [6][7] - **Wuhan**: The city plans to advance urban renewal projects, with significant population growth in key industries. Although there is inventory pressure in suburban areas, core district prices are stabilizing [7] General Market Trends - The article notes that while some cities may see price increases, the notion of prices doubling is exaggerated. Core areas in cities like Shanghai, Beijing, and Shenzhen are expected to see price increases of 5%-8%, while strong second-tier cities like Chengdu and Nanjing may see increases of 10%-15% [8][9] - The article highlights the risk of price declines in the second-hand housing market, with a 0.69% month-on-month drop in April 2025 across 100 cities, and significant declines in third- and fourth-tier cities [9][10] - Overall, cities with strong policy support, population inflow, and solid industrial foundations are likely to experience significant price increases in the latter half of 2025 [10]