China’s housing price index tumbled 0.1% in July compared with the previous month, and 3.2% compared with July 2019, bringing the nation’s property slowdown to a new low in the face of continued lackluster demand. The annual decline was slightly reduced from 3.3% in June, the figures released on Monday by the National Bureau of Statistics showed.
The monthly decrease remained unchanged from June, and 17 of the 70 cities studied experienced price increases. The figures indicate that the housing market is still a niche market in select major cities, instead of being nationalized.
The July decline marked the 37th consecutive month in which new home prices fell on an annual basis. The prolonged weakness has remained a drag on China’s domestic economy, with falling property values and weak home sales weighing on consumption and investment.
Gains Remain Concentrated in Major Cities
The recovery also lost momentum in China’s largest cities in July.
New home prices are unchanged in the four first-tier cities after a 0.1% increase in June. Second-tier cities saw prices drop 0.1% from a flat June, whereas prices in third-tier cities decreased 0.3% month on month.
Zhang Dawei, analyst at Centaline Property, described the pattern as a “K-shaped recovery.” “The number of cities reporting price gains remained below one-third of the total, indicating that the overall market has yet to emerge from its adjustment cycle,” Zhang said.
Sales and Investment Continue to Contract
In the first seven months of 2026, real estate development investment decreased by 19.2% year on year. The floor area of newly constructed commercial properties sold decreased by 11.8% over the same period, and the value of such sales decreased by 13.1%.
The numbers are a testament to the continued sluggish demand from developers despite some major markets dabbling in stabilization. The fall in sales value was greater than the drop in floor area, indicating that there has also been a drop in sales prices.
The decline in property sales has been paralleled by weaker domestic economic activity. The National Bureau of Statistics reported on Tuesday that China’s manufacturing output rose 4.5% year on year in July and retail sales dipped 0.6%. The value of fixed-asset investment decreased 6.7% during the first seven months.
China’s second-quarter economy grew 4.3% year on year, its slowest pace in more than three years, according to Reuters.
Authorities Focus on Stabilizing Major Housing Markets
Chinese authorities have continued to use city-level measures to support the housing market rather than introducing a broad nationwide stimulus package.
The Communist Party’s Politburo said July 30 that China would implement policies to support economic growth and called for efforts to stabilize the property market. The meeting did not announce a major new nationwide housing stimulus package.
Beijing has also adjusted housing policies. The city has expanded eligibility for home purchases in some areas and increased support through its housing provident fund system.
The policy approach reflects the uneven conditions across China’s housing markets. Stronger demand in major cities has allowed authorities there to focus on encouraging purchases, while smaller cities continue to face the challenge of excess housing inventory.
National Housing Recovery Remains Elusive Despite Gains
China’s housing market has shown pockets of improvement during 2026, particularly in some first-tier cities. But the July figures suggest those gains have not yet translated into a broad national recovery.
The National Bureau of Statistics stated that investment in real estate development decreased by 19.2% in the first 7 months of the year, whereas new-home sales in terms of floor area dropped by 11.8% during the same period. As this was happening, new home prices on an annual basis kept falling for 37 consecutive months.
The next test for the property market will be whether policy support can translate into stronger sales and stabilize prices beyond China’s largest cities. For now, the July data show that the housing sector remains a significant weakness in an economy
