Kerui: New housing supply “improved quality and volume” in December+increased marketing and anticipated transactions “ended”

The Zhitong Finance App learned that according to Kerry Real Estate Research, the supply of new homes remained low in December. The monthly supply in 28 cities fell 12% month-on-month and 49% year-on-year. The cumulative year-on-year decline for the whole year was 19%, and supply constraints are still significant. First-tier cities remained stable month-on-month, with only Beijing showing significant growth. The second-tier decline was more than 50% year-on-year, with more losses and fewer gains. The decline in supply in third- and fourth-tier cities was unstoppable, and the low base increased significantly from month to month. Looking at the supply structure, the share structure for immediate demand, improvement, and high-end in key cities is 26%, 56%, and 18%, showing a supply structure where improvements are the main focus and immediate needs are complemented. Nearly 80% of cities use the main city as the main supplier. Based on the “improvement in quality and volume reduction” of supply in December, combined with housing companies' year-end sprint release discounts, it is expected that new housing transactions in December will still usher in a wave of pulsive recovery. However, based on last year's high base, the year-on-year decline may continue to expand.

01 scale: On December 28, the city's supply restrictions remained the same. The first line remained flat last month, and the second tier pulled back significantly

Housing companies' enthusiasm for promotion in December was still low, and supply constraints were still significant: according to CRIC research, the city is expected to add 5.68 million square meters of commercial housing supply area on December 28, down 12% from the previous month, and is expected to drop 19% year on year for the whole of 2025.

First-tier cities remained stable month-on-month, and Beijing concentrated on volume. According to CRIC monitoring data, the four first-tier cities are expected to supply 1.47 million square meters in December, a slight decrease of 1% from the previous month. Since then, the cumulative supply for the whole year has dropped 15% year over year. Among them, Beijing doubled month-on-month, and housing enterprises concentrated on promoting performance at the end of the year. Shanghai has ushered in an “empty window period”. The monthly supply is only 50,000 square meters, and the pace of delivery has slowed drastically. Guangzhou and Shenzhen declined by 4% and 26%, respectively, and the supply side remained cautious.

Second-tier cities fell 20% month-on-month, and urban differentiation intensified. According to CRIC monitoring data, 19 second-tier cities are expected to supply 3.85 million square meters in December, a decrease of 20% month-on-month, and a cumulative year-on-year decline of 19%. The short-term volume in Ningbo and Changchun was significant, with month-on-month increases of over 120%. Wuhan, Changsha, and Hefei increased by more than 60% month-on-month, which is a low level of replenishment. Supply is sluggish in most second-tier cities. Among them, Xi'an, Chengdu, Jinan, and Fuzhou saw significant month-on-month declines, all of which were above 60%, and housing enterprises were generally not very motivated to promote the market.

The supply base in third- and fourth-tier cities increased sharply from month to month. The five third- and fourth-tier cities estimated the supply of 350,000 square meters in December, an increase of 82% over the previous year, and a cumulative year-on-year decrease of 22% for the whole year. Zhangzhou and Quanzhou saw significant month-on-month increases, mainly due to the low base in the previous period.

02 Structure: Nearly 80% of cities use the main city as the main supply force, and 18 cities, including Shanghai, Rong, Tianjin, and Han, lead the share of improvements

Judging from the distribution of various product grades in the supply structure, the market continues to lean towards improved demand: the share structure of immediate demand, improvement, and high-end in key cities is 26%, 56%, and 18%, showing a supply structure mainly based on improvements and supplementing immediate needs.

Typical cities can be broadly divided into the following categories: (1) Cities such as Ningbo and Nanjing all account for about 60% of the supply of products that are just needed. (2) The share of immediate needs and improvements in Zhengzhou, Guangzhou, Changsha, and Beijing is inseparable, accounting for 4-5 percent. (3) Eighteen cities, including Shanghai, Chengdu, Tianjin, and Wuhan, still use improved products as the main supply force. Under the current “marketable, fixed production” model, marketable, improved markets and increased supply are also expected to ensure short-term market stability. (4) High-end products such as Shenzhen, Hangzhou, Fuzhou, and Wuxi ranked first among all product categories this month.

Judging from the regional distribution of various projects in the supply structure, the main cities of key cities account for 66%, 24%, and 10%. This month's supply focus was still concentrated in the main urban area, followed by the suburbs, and the fewest. By city, major cities such as Quanzhou, Fuzhou, Zhengzhou, Nanning, Xi'an, Kunming, and Chongqing all account for more than 90%, while Changchun, Jinan, Changsha, and Ningbo are mainly suburban projects, accounting for 50% or more. This month's promotion of Qingdao and Suzhou took into account both the main urban area and the surrounding suburbs, with the two regions accounting for the same share. In addition, Shanghai, Tianjin, and Nanjing will focus on remote suburban projects this month.

03 Forecast: New housing transactions in most cities are expected to “end” in December, with a significant month-on-month recovery

We took stock of December supply, combined with current transaction characteristics in various cities, to make a simple prediction for the future market: supply remained low in December, and housing enterprises were generally active in promoting the market, but thanks to the fact that the share of improvements in the main urban area was still rising, compounded by the release of year-end sprint discounts, it may drive new housing transactions to a pulsed end, with a significant month-on-month recovery.

Judging from the popularity of the market, the average removal rate is expected to be around 30% at the opening of the market: according to CRIC monitoring data, 28 key cities are expected to have an average removal rate of about 30% of projects in December 2025. The differentiation among cities will continue to intensify: in early hot cities such as Shanghai and Chengdu, the scale of new housing transactions is expected to remain low in December. On the one hand, there was a significant contraction in supply, and both showed a sharp decline in transaction volume to a certain extent; on the other hand, judging from microscale projects, some early hot sector projects also showed signs of a gradual decline in sales, such as Shanghai's Yangpu East Bund and Pudong North Cai. Overall demand is facing phased bottlenecks. Tianjin, Wuhan, Nanjing, and Hefei continued the weak recovery trend, and confidence in home buyers gradually recovered; there are also weak second-tier cities such as Zhengzhou, Fuzhou, and Xiamen, where new housing transactions are expected to rebound only slightly.