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hina's real estate sector may not recover until the second half of 2025, despite recent stimulus measures, according to three research firms. Analysts at Goldman Sachs predict property prices will stabilize by late 2025 and rise by an average of 2% two years later, while sales and new construction are unlikely to stabilize until 2027.

    S&P Global Ratings and Morgan Stanley also forecast a market bottom in the second half of 2025, citing government support for developer financing and destocking. However, analysts caution that it will take time for policies to take effect, and Beijing's efforts to bolster advanced manufacturing as a new driver of growth may hinder real estate sector recovery.

    China's indebted developers have struggled to deliver pre-sold homes, dampening consumer sentiment. Analysts are watching a parliamentary meeting next week for details on fiscal spending to reduce housing inventory, which Goldman predicts will be around 8 trillion yuan ($1.12 trillion). Without such stimulus, the property market downturn could be prolonged by another three years.

    The business model of selling houses ahead of completion has proven unsustainable after Beijing cracked down on developers' high reliance on debt for growth. Nomura estimated that about 20 million pre-sold homes remain unfinished, while officials have indicated around 4 million homes have been completed and delivered to buyers under this year's whitelist program.

    China's latest efforts to bolster confidence have given the real estate market a lift, with property sales in 22 major cities falling by around 4% on-year in October. However, analysts project any rebound in home sales and new construction will remain subdued in the coming years, with S&P expecting property sales to decline to around 9 trillion yuan or less this year.

    The deteriorating sales also take a further toll on developers' liquidity, leading to a "lack of confidence" and developers seeking a cautious approach toward land acquisition and initiating new projects. Analysts remain cautious about the impact of China's real estate stimulus, warning that property prices could drop by another 20% to 25% if policy falls short.