Core Viewpoint - The real estate market is experiencing a downward trend, with first-tier cities seeing a decline in new home prices, leading to a significant drop in consumer confidence [1][4]. Market Overview - In June, new home prices in first-tier cities fell by 0.3% month-on-month, with the decline in prices expanding compared to the previous month [1]. - The overall sentiment towards the real estate market is pessimistic, with many expecting continued price drops [4][5]. Market Dynamics - The previous upward cycle in the real estate market has ended, shifting from a supply-demand imbalance to a situation where supply exceeds demand [5][6]. - The market is becoming more rational, and the likelihood of irrational price drops is decreasing [7]. Policy Support - Government policies are being implemented to stabilize the real estate market, including lowering mortgage rates and easing purchasing qualifications [6][7]. - These measures are intended to halt the decline in prices and provide support to the market [5][6]. City-Specific Trends - Major cities like Beijing and Shanghai are showing signs of recovery, with increases in transaction volumes for both new and second-hand homes [8]. - In contrast, many small and medium-sized cities are facing severe oversupply, leading to continued price adjustments, albeit at a reduced rate compared to previous years [9][11]. Future Demand Trends - As basic housing needs are met, there is expected to be a significant increase in demand for improved housing options [13][14]. - Developers are beginning to focus on high-quality residential projects to cater to the emerging demand for better living conditions [14].