Publications

- May 1, 2021: Vol. 13, Number 5

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Housing gambit: The multiplayer game of investing in China’s residential market

by Robert Ciemniak

With the post-COVID recovery and another record year for new home sales in 2020, tightening the residential market in China has been back on the agenda since the third quarter of last year.

The country’s new 14th Five-Year Plan (2021–2025) and earlier policy indications point at a much more contained housing market and a greater focus on rental housing. Developers are expected to consolidate further and explore a range of new strategies. Investors are likely to reopen longer-term questions about investing in Chinese property.

To that end, looking at China’s residential markets through the lens of a multiplayer game among the central government, local governments, developers, lenders and homebuyers can yield a better perspective than any market demand/supply models.

Before looking at the next five years, it is worth reflecting on the past five. To many who were worried about the market in 2015–2016, these data points might come as a surprise, comparing 20

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