The real estate market consistently garners significant attention during the annual National People's Congress sessions. The 2026 Government Work Report's emphasis on "focusing on stabilizing the real estate market" demonstrates greater resolve and confidence compared to the 2025 objective of "making sustained efforts to halt the decline and stabilize the real estate market."

The government's plan for real estate work centers on "stability" as the main theme, with "city-specific policies" as the primary tool. In the short term, the approach is to use financial measures to "stabilize the property market" while maintaining a baseline of "preventing risks" and meeting diverse housing needs. For the long term, the strategy involves optimizing supply, constructing "quality homes," and establishing a new development model to guide the industry onto a path of sustainable growth.

Implementing this "new development model" for the real estate sector is fundamentally about creating a coordinated mechanism linking "population, housing, land, and capital." This involves regulating land supply and new construction scales based on population mobility and inventory absorption cycles, aiming to achieve "land supply following population movement" and "housing construction aligned with demand."

A strong foundation is built by enhancing supply. Optimizing supply requires starting with "land" and "housing," which are also key to deepening the development of the foundational systems and supporting policies for the new real estate model.

This year's Government Work Report proposes measures including "implementing city-specific policies to control new supply, reduce inventory, and optimize overall supply; exploring multiple channels to revitalize existing commercial housing stock; and encouraging the acquisition of such stock primarily for affordable housing." It also advocates for "high-quality urban renewal, steadily advancing the renovation of old urban residential areas and urban villages," and "revitalizing the use of existing land and idle housing facilities." Furthermore, it calls for the "orderly promotion of safe, comfortable, green, and smart 'quality homes,' implementing projects to enhance housing quality and actions to improve property service standards."

Achieving the "optimized supply" goal requires a multi-pronged approach. First is revitalizing existing housing stock. It is anticipated that future acquisitions of existing commercial properties will be increasingly led by local governments. Beyond acquiring newly built homes, purchasing second-hand properties is also expected to become a major strategy for cities to reduce inventory and activate existing assets. In early February, three districts in Shanghai began pilot programs to acquire second-hand homes for use as government-subsidized rental housing, positively influencing market expectations, with more cities likely to follow. Second is the construction of "quality homes," which has become crucial for developers to enhance their product and secure market share. In 2025, projects in core areas of many cities that sold out rapidly offered not only high usable area ratios but also embodied the core features of "quality homes"—safety, comfort, sustainability, and smart technology—often integrating third-party services like elderly care, childcare, and housekeeping. This is gradually forming a composite living model combining "hardware + services," serving as a vital pivot for the new development model. Third is advancing high-quality urban renewal. Urban renewal in China is transitioning from a pilot exploration phase to a new stage of systematic implementation, with pace noticeably accelerating across regions. The scope for issuing infrastructure REITs has also expanded to include urban renewal facilities. This indicates that whether dealing with urban villages, old residential communities, existing commercial housing, idle land, or underperforming commercial properties, renewal mechanisms can facilitate the reconfiguration of both spatial function and economic value.

Vitality is being enhanced by stimulating demand. Currently, various localities are implementing "city-specific policies" focused on lowering home purchase thresholds and costs, and increasing willingness and ability to buy, which have already yielded results. Building on this, this year's Government Work Report for the first time proposes strengthening housing support for newlywed and first-time parenting families, and supporting housing improvement needs for families with multiple children. The report also mentions deepening reforms to the housing provident fund system. This signals a more targeted approach to encouraging housing demand release, aiming to organically combine "benefiting people's livelihoods" with "stabilizing the market" through deep coordination between real estate and population policies.

It is expected that more targeted and detailed policies will be introduced locally in areas such as financial support, home purchase subsidies, and housing provident funds. Furthermore, while previous housing policies have notably favored multi-child families, future measures may address the housing needs of newlywed families through various means like housing credit, direct fiscal subsidies, and inventory revitalization.

Risk mitigation continues through the advancement of the "project delivery guarantee" initiative. While risks in the real estate sector have eased due to previous sustained efforts to ensure project completion and resolve developer debt risks, maintaining vigilance against potential risks remains essential.

This year's Government Work Report proposes further utilizing the "white list" system for ensuring project delivery to prevent debt default risks. This indicates that the "white list" mechanism has proven effective in practice, significantly accelerating the process of clearing sector risks. It is anticipated that the "white list" system will continue to serve as a core tool for targeted support, facilitating financing for eligible projects, ensuring their delivery, safeguarding basic living standards, and encouraging developers to shift towards compliant financing and refined operations.

Building a new model for real estate development is a systemic undertaking that cannot be achieved overnight. It requires coordinated efforts from all parties to properly allocate the elements of "population, housing, land, and capital" and to methodically establish the foundational systems. Recent market conditions show signs of stabilization in regional markets; in January, the month-on-month declines in home prices across tier-one, two, and three cities generally narrowed, indicating positive changes. As the real estate sector gradually emerges from its adjustment period, the industry is expected to form a new development pattern oriented towards quality supply and characterized by more stable operation.