China's new home sales fell 11.2% year over year in the first 11 months of 2025, pointing to continued weakening in the market, Fitch Ratings said in a Tuesday release.

Moreover, gross floor area (GFA) sold dropped 8.1% while average selling price (ASP) declined 3.3%.

The results are all below Fitch's full-year forecasts for drops of 7% in sales, 5% in GFA, and 2% in ASP.

Depressed buyer confidence fueled by a weak economy, employment slump, and price reduction forecasts contributes to the dampened performance, Fitch said.

While the rising gap between the declines in secondary home prices and new home prices may not linger, new home prices remain constrained by competitive pressures, Fitch said.

Nationwide transactions fell 27% year over year, signifying narrowing land supply, although volumes in tier one cities increased 36%, the rating agency said.