In recent weeks, a series of pivotal meetings have been convened by various financial regulatory bodies and institutions across multiple regions, setting the stage for initiatives slated for the year 2025. One of the central themes that has emerged from these discussions is the emphasis on financial support aimed at stabilizing the real estate market—an enduring focus for this yearFinancial institutions have voiced their commitment to fostering high-quality development within the real estate sector, as experts in the field underline the significance of ongoing optimization of financial policies to enhance market expectations and boost participation.

The year 2024 marks a significant milestone, as it is the initial year for the comprehensive implementation of a coordinated real estate financing mechanismTo date, this initiative has facilitated the construction and delivery of approximately 14 million housing units

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According to Xiao Yuanqi, the vice director of the National Financial Supervision Administration, the "white list" mechanism has played a crucial role by ensuring that sufficient and stable funding is allocated for real estate project completionBy the end of 2024, the loans issued for "white list" projects by commercial banks reached an impressive 5.03 trillion yuan—surpassing initial projections of 4 trillion yuanThis figure was further boosted on January 22, 2025, when an additional 570 billion yuan was allocated, raising the total loan amount to 5.6 trillion yuan.

Looking ahead to 2025, financial support for stabilizing the real estate market remains a focal point for both regulatory bodies and financial institutionsDuring recent meetings, various financial oversight agencies reiterated their commitment to facilitating a stable and healthy development of the real estate market

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For instance, the Guizhou Financial Regulatory Bureau reported that by the end of 2024, loans exceeding 50 billion yuan had been approved for the province's "white list" projectsThis agency has set a top priority for 2025 to continue expanding and improving the urban real estate financing coordination mechanism to support a stable marketSimilarly, the Chongqing Financial Regulatory Bureau outlined its multifaceted approach for 2025, highlighting the need for accelerating the expansion and enhancement of the real estate financing coordination mechanism to actively support the market's stabilization.

In an example from Chongqing, the local regulatory authority has efficiently reviewed existing real estate development loan projects and promptly incorporated them into the "white list." The Industrial Bank's Chongqing branch took proactive measures by engaging with a local project in Yuzhong District, promptly educating the company about the policies related to the expansion of the "white list" and ensuring the project enjoyed fast-tracked approval through a dedicated service channel

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Such efforts have significantly contributed to stabilizing financing for real estate firms and ensuring project completion.

Experts like Dong Ximiao, the chief researcher at Zhangle, assert that the expansion of the "white list" enhances the security of real estate project completion and delivery, thereby helping to restore public confidence in purchasing new homes and actively contributing to a favorable market turnaround.

Financial institutions consistently affirmed their ongoing support for high-quality development in the real estate sector during recent working meetingsThe Agricultural Bank of China's 2025 conference highlighted the need for robust implementation of funding for urban real estate "white list" projects while concurrently coordinating financing for small and micro enterprises to bolster economic recoveryThe Industrial and Commercial Bank of China reiterated its commitment to the urban real estate financing coordination mechanism

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Meanwhile, the China Construction Bank's management meeting emphasized leveraging existing advantages in infrastructure, consumer finance, and real estate finance to stimulate domestic demand's comprehensive expansion.

As Xiao Yuanqi expressed, the recent positive shifts in the real estate market have showcased the vital role of the financing coordination mechanism in safeguarding homeowners' legal rights and facilitating a stabilization in the market trendsMoving forward, continued efforts will be made to optimize this mechanism to promote stable financing within the real estate sector, maximizing the distinct advantages offered by various financing tools and fostering a synergistic effect aimed at improving precision, timeliness, and efficacy.

The push for enhancing the quality of living conditions has also emerged as a prominent agenda“Vigorously implementing urban renewal” stands as one of the key priorities outlined for housing and urban-rural construction conferences for 2025. A significant aspect of this focus is to complete the renovation of dilapidated urban communities constructed before the end of 2000, aimed at improving urban living conditions comprehensively.

Statistics suggest a substantial commitment, with the National Development Bank earmarking 273 billion yuan in long-term loans between January and November 2024 to support infrastructure renovation, sponge cities, dilapidated community renovations, security projects for urban lifelines, heritage conservation, and environmental infrastructure, all of which are pivotal in uplifting urban quality and functionality.

The urgency for urban revitalization, particularly in unsafe neighborhoods with sub-par living conditions, has resonated strongly with residents

During the course of discussions about prioritizing 2025 agendas, the promotion of modifications to urban villages and dilapidated buildings was underscored, with plans for a monetary settlement to encourage relocation and an expansion of urban village renovations by an additional 100,000 unitsSuch initiatives aim not only to enhance safety but also to significantly uplift living standards.

For instance, in Wenzhou, Zhejiang Province, various urban village renovation projects are underway across 15 villages, including Longwan District’s Yongxing Street and Haibin Street—totaling over 4,000 acres of landLocal governments are eager to expedite residential relocation, accommodating residents based on their preferencesHowever, challenges have arisen, as some residents find themselves facing additional costs due to compensation amounts falling short of the area of newly assigned housing, presenting them with bureaucratic quandaries.

In response to these complications, the Agricultural Bank of Wenzhou’s Longwan branch initiated constructive dialogue with relevant government departments and displaced residents

They recognized the various issues stemming from low credit limits and high interest rates associated with housing that lacks official permits for mortgagesWith the impetus from urban planning authorities, an innovative “personal mortgage loan for relocation housing” was launched—offering benefits similar to standard residential mortgages in terms of interest rates, application processes, loan amounts, and termsThis proactive initiative allowed residents to secure their mortgages efficiently, as evident by MrLi from Longwan District, who became the inaugural beneficiary of this scheme, successfully moving into his new home just days after initiating the loan process.

Economic commentators like Wen Bin from China Minsheng Bank have indicated that the central government’s clear directive to bolster upgrades in urban villages and dilapidated residential properties points towards unlocking latent housing demand

This, coupled with the continued release of policy effects, is expected to accelerate the depletion of inventory in the real estate sector.

Reflecting on the year 2024, the orchestration of collaborative policy measures like the “Four Cancellations, Four Reductions, Two Increases” tactic has been critical in addressing region-specific needs and fostering a recovery in the real estate market.

The “Four Cancellations” empower local governments to have compelling control over regulatory measures concerning home purchases, including lifting restrictions like purchase ceilings, resale restrictions, price caps, and differentiating residential standardsThe “Four Reductions” entail a reduction of housing loan interest rates by 0.25 percentage points while standardizing down payment ratios to a minimum of 15% for both first and second homes, alongside reducing rates on existing loans and lowering the tax burdens associated with housing upgrades

The “Two Increases” focus on increasing the quota for urban village renovations and dilapidated housing rebuilds through financial mechanisms and raising the credit scale for “white list” projects to 4 trillion yuan by the end of 2024.

As Xiao Yuanqi emphasized, effectively utilizing various financing tools for real estate development fosters a synergistic effect while tailoring financial products to the unique characteristics and needs of distinct projects is paramount to improving the support system's precision, timeliness, and effectivenessThe People's Bank of China has articulated its commitment to enhancing macro-prudential management in real estate financing while nurturing new developmental models within the sector for 2025. Observers assert that with the continued optimization of financial measures and cooperative efforts, market expectations among stakeholders will increase, energizing the market and ultimately guiding the real estate landscape towards stable and healthy progression.