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Shanghai has launched a new initiative to encourage the purchase of second-hand homes, aimed at better serving the housing rental needs of recent arrivals and young residents, while also stimulating the resale property market.
The program commenced yesterday in the city’s Jing’an and Xuhui districts, as well as in the semi-urban Pudong New Area. Public rental and affordable housing companies in these areas have signed credit cooperation agreements with China Construction Bank to facilitate this effort.
Under this initiative, these firms will purchase small- and medium-sized pre-owned homes under 70 square meters that are well-located and have clear property titles, making them suitable for affordable rental housing for migrant workers and young professionals. Details regarding the program’s scope and rollout timeline are yet to be disclosed.
Industry experts highlight that government-backed entities acquiring existing homes can strengthen Shanghai’s housing security framework. This approach offers a faster alternative to constructing new public rental units, thereby accelerating the availability of housing supply.
This program is expected to enhance overall housing stability in the district and positively influence the liquidity of the local second-hand property market, according to a senior analyst at Shanghai’s leading real estate research firm.
Many homeowners participating in this program may use the proceeds from sales to upgrade their living conditions by purchasing better properties, which can help increase local housing transactional activity, the analyst noted.
Recent data from Shanghai’s leading property research institute shows that the city’s second-hand housing market is stabilizing. Last month, resale transactions increased by 25 percent year-over-year to approximately 22,000 units, maintaining this volume for three consecutive months.
Home prices for pre-owned properties have not declined for three months straight, and buyer hesitation seems to be gradually waning, according to Li Gen, head of the local research institute. He also predicts that this new home purchase program will further boost transaction volumes throughout the city.
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