S&P Global Ratings has lowered its forecast for China’s real estate sales in 2026, now expecting a decline of between 10% and 14%, compared with its previous estimate of a 5% to 8% drop.
The agency said the crisis has deepened to a level that requires government intervention to absorb excess supply by purchasing unsold housing units and converting them into affordable housing. However, it noted that current measures remain limited. S&P also expects property prices to fall by 2% to 4% this year due to oversupply.
China has announced its intention to intensify urban renewal efforts and strengthen the stability of the real estate market starting in 2026 as part of its five-year plan through 2030, according to the Ministry of Housing. The focus will be on urban redevelopment, market stabilization, risk reduction, and improving the supply of affordable housing.
This comes as China’s real estate sector has been experiencing a continuous downturn since mid-2021, despite government pledges to support the industry.
