Photo: Felix Andrews, Wikimedia Commons, CC BY-SA 3.0. Image resized.
China’s spending on new housing and commercial property has fallen by about a fifth this year, and builders have almost stopped breaking ground on new projects, according to figures from the country’s National Bureau of Statistics.
The bureau reported on Oct. 20 that real estate development investment from January through September was 5.34 trillion yuan, down 20.6% from a year earlier on a comparable basis. Investment in residential buildings, the largest part of the total, fell 20.5% to 4.11 trillion yuan. Office buildings dropped 21.0% and commercial buildings such as shops fell 25.9%.
New construction has nearly stalled
The sharpest declines were in projects that have only just begun. Developers started construction on 340.31 million square meters of floor space in the first nine months, down 24.9%. That is roughly 3.7 billion square feet, about a quarter less than last year. Completions fell 25.1% to 232.71 million square meters. The total amount of floor space under construction across the country dropped 12.8% to 5.65 billion square meters.
When fewer projects start, fewer building sites need crews, from steelworkers and concrete teams to electricians and equipment operators. The statistics bureau’s property release does not report construction employment, so the effect on jobs is not measured there. It does show the pipeline of future building work shrinking quickly.
Buyers and lenders are pulling back
Demand is also weaker. Sales of newly built commercial buildings, which include apartments, covered 564.83 million square meters, down 13.2%, and were worth 5.38 trillion yuan, down 13.9%. Residential sales by value fell 13.7%. The bureau said transactions in second-hand homes tracked by the Ministry of Housing and Urban-Rural Development rose 10.7% by floor space, a sign that buyers are leaning toward existing homes over new ones.
New homes waiting for buyers are still piling up, though more slowly. At the end of September, 748.25 million square meters of newly built commercial space was for sale, down 1.5% from a year earlier. Of that, 541.97 million square meters had been on the market for less than three years.
The money behind projects is shrinking even faster than the building itself. Funds available to developers for this year’s investment totaled 5.68 trillion yuan, down 21.6%. Domestic bank loans fell 33.1% to 762.4 billion yuan, self-raised funds dropped 21.4%, deposits and advance payments from buyers declined 14.8% and individual mortgage loans fell 22.1% to 767.8 billion yuan. Advance payments from buyers have long been a main source of cash for Chinese developers, so slower sales leave less money to finish homes already sold.
Property and related industries have been a major driver of China’s growth for two decades, and a downturn in housing reaches households, which hold much of their savings in homes, and local governments that have relied on land sales for revenue.
Figures are from the National Bureau of Statistics of China, Investment in Real Estate Development from January to September 2026, released Oct. 20.
JBizNews Desk | Beijing
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