One month after the new policies in Shanghai's real estate market, the transaction area of new homes has reached a weekly high since 2026.

Reporter Zhang Xiangyi

On February 25, the Shanghai Municipal Housing and Urban-Rural Development Management Committee and four other departments jointly issued the “Notice on Further Optimizing and Adjusting the City’s Real Estate Policies” (hereinafter referred to as the “Notice”), introducing seven measures to further reduce housing purchase restrictions, optimize housing provident fund loan policies, and improve individual housing property tax policies.

Since the release of the “Notice” one month ago, Shanghai’s real estate market has shown positive changes. According to the Iceberg Index real estate data platform, as of March 24, the transaction volume of second-hand homes in Shanghai has increased by 4% year-on-year since March. Data from the China Index Academy shows that in the second week of March (March 9-15), the transaction area of new commercial residential properties in Shanghai reached 220,000 square meters, a 62% increase from the previous week, marking the highest weekly transaction volume since 2026.

“Second-hand homes respond more directly to this round of policy adjustments, with the market showing some early signs of recovery, mainly driven by demand from first-time buyers,” said Cao Jingjing, General Manager of the Index Research Department at China Index Academy, in an interview with Securities Daily. From the perspective of total price characteristics, low-priced homes are seeing increased transactions, and after price adjustments, their cost-performance ratio has become more apparent. With the release of policy benefits, the willingness of cautious first-time buyers to enter the market has increased, driving up transactions of low-priced homes.

It is worth noting that the number of new listings for second-hand homes in Shanghai has decreased, easing the inventory pressure in the second-hand market.

According to China Index Academy statistics, in the first two weeks of March, the number of new listings for second-hand homes in Shanghai decreased by 27% and 48% year-on-year, respectively. Meanwhile, the total number of existing listings has also declined, with the total listings of leading agencies at the end of February down 30.7% from the peak in October last year, returning to a level not seen in nearly three years.

Cao Jingjing believes that the simultaneous decline in new and existing listings in Shanghai reflects an improvement in some owners’ market expectations, which helps alleviate short-term supply and demand tensions and creates favorable conditions for market stabilization.

The “Notice” shortens the required social security or individual income tax payment period for non-Shanghai residents to purchase housing inside the outer ring road, and explicitly states that “qualified non-Shanghai residents can purchase one additional housing unit inside the outer ring,” clearly lowering the threshold for home purchases.

At the same time, the “Notice” increases the maximum housing provident fund loan limit, optimizes the loan qualification process, expands support for multi-child families in home buying, and reduces residents’ home purchase costs.

Under policy support, the new home market has also shown signs of recovery. “After the new policy was released in Shanghai on February 25, the visitation to some quality projects increased, and transaction volumes began to rebound,” Cao Jingjing said. Due to supply rhythm, the recovery of the new home market lagged behind that of the second-hand market, but positive signals have already appeared under the influence of policies. Additionally, in March, developers accelerated their project launches, and improved-type projects are expected to support the market.

“Every weekend in March, I worked overtime, and there are many clients on weekdays. Last Thursday, I had four groups of clients revisiting,” a sales staff member at a new housing development in Songjiang District, Shanghai, told reporters. The combined effect of the new policies and the peak sales season in March has increased both visitor numbers and transaction volumes.

Cao Jingjing believes that if current market sentiment can continue, Shanghai is likely to maintain high activity during the “small spring” market from March to April. However, it should be noted that market stabilization is a gradual process, and the sustainability of this trend still depends on macro fundamentals such as residents’ income expectations and housing price recovery.

Regarding future policies to support market enthusiasm, Li Yujia, Chief Researcher at the Guangdong Housing Policy Research Center, stated that the cycle of demand from first-time and improved buyers still faces bottlenecks. The main issues are the long transaction cycle for second-hand homes and significant discounts on final sale prices, leading to long and costly replacement cycles. Policy measures should involve government storage and market efforts to promote second-hand home exchanges.