CRIC Real Estate Research has published a report stating that in the third quarter of 2026, under the combined effect of the institutional restructuring brought by the "828 New Policy" and adjustments in market expectations, the primary and secondary transaction structures continued to diverge, the share of second-hand homes in housing transactions in key cities rose further, and the "second-hand home dominance" pattern continued to strengthen. In terms of total transaction volume, the total scale of primary and secondary residential transactions in the third quarter remained at a high level, with data from Zhito Finance APP.

In the third quarter, the total transaction area of primary and secondary residential properties in 20 key cities reached approximately 64.04 million square meters, down 20.6% quarter-on-quarter; compared with the approximately 62.92 million square meters in the same period last year, it still achieved a slight year-on-year increase of 1.8%. Cumulative transactions in the first three quarters totaled approximately 204.50 million square meters, a slight year-on-year increase of 0.4%, with the total scale basically flat compared with the same period last year.

Overall Review: Primary and Secondary Divergence Continues, Secondary Home Dominance Further Strengthened

From the transaction performance perspective, new home transactions in the third quarter amounted to 19.73 million square meters, down 28.0% quarter-on-quarter and down 7.8% year-on-year; cumulative transactions in the first three quarters reached 65.45 million square meters, down 10.5% year-on-year. Meanwhile, second-hand home transactions in the same period amounted to 44.31 million square meters, down 16.8% quarter-on-quarter but still up 6.7% year-on-year; cumulative transactions in the first three quarters reached 139.06 million square meters, up 6.5% year-on-year. The quarter-on-quarter decline for second-hand homes was 11.2 percentage points smaller than that for new homes, and the year-on-year figure was 14.5 percentage points higher, indicating that second-hand home transaction performance was significantly better than that of new homes.

Figure 1: January 2023 to September 2026 Transaction Area Trends of Primary and Secondary Residential Properties in 20 Key Cities. Data source: CRIC China Real Estate Decision Consulting System. Note: The 20 key cities include Beijing, Chengdu, Dalian, Dongguan, Foshan, Guangzhou, Hangzhou, Huizhou, Nanjing, Ningbo, Qingdao, Xiamen, Shanghai, Shenzhen, Suzhou, Tianjin, Wuhan, Xi'an, Yangzhou, and Chongqing, using the same criteria as second-hand homes.

From the transaction structure perspective, the share of second-hand transactions continued to rise. The share of second-hand homes in total primary and secondary transaction area rose from 47.2% in the first quarter of 2023 to 69.2% in the third quarter; the cumulative share in the first three quarters was 68.0%, up 3.9 percentage points from the same period last year (64.1%). Monthly shares in the third quarter stabilized at around 69%, with the transaction scale of second-hand homes approximately 2.2 times that of new homes, further cementing their dominant position.

Figure 2: January 2023 to September 2026 Monthly Changes in the share of Primary and Secondary Residential Transaction Area in 20 Key Cities. Data source: CRIC China Real Estate Decision Consulting System.

By city tier, the divergence between first-tier and second- and third-tier cities further deepened, with total volume stability mainly contributed by first-tier cities. In the third quarter, combined primary and secondary transactions in first-tier cities amounted to 18.13 million square meters, down 16.6% quarter-on-quarter but up 7.2% year-on-year, with cumulative growth of 3.1% in the first three quarters; combined transactions in second- and third-tier cities amounted to 45.91 million square meters, down 22.1% quarter-on-quarter and basically flat year-on-year (-0.2%), with a cumulative year-on-year decline of 0.7% in the first three quarters. The resilience and stability of first-tier city transactions stem from relative advantages in demand base, supply structure, and price adjustment progress, forming key support for the overall volume platform.

New Commodity Residential Market: Proactive Supply Clearing, Transaction Bottoming Out with Divergence

Supply: Centralized release at the end of the third quarter, but still down 6.0% quarter-on-quarter, with the supply contraction tone unchanged. Supply-side contraction further deepened in the third quarter. According to CRIC monitoring, the cumulative new supply in 50 typical cities nationwide in the first three quarters was 75.53 million square meters, down 21.2% year-on-year, with the decline narrowing slightly by 0.5 percentage points from the first half. In absolute terms, this is only about 47% of the same period in 2023, with the supply contraction still at a historically high level. By quarter, supply was 19.04 million square meters in the first quarter, rebounded to 29.11 million square meters in the second quarter, and fell back to 27.38 million square meters in the third quarter, down 6.0% quarter-on-quarter and down 20.4% year-on-year, with year-on-year declines exceeding 20% in all first three quarters, leaving the supply contraction tone unchanged. From the monthly trend, January-February saw supply at the annual trough due to the Spring Festival holiday and weak market expectations, with monthly scale below 6 million square meters; March saw seasonal release to 9.12 million square meters with the "mini spring," April further rose to 11.39 million square meters, forming the first supply peak of the year; after a brief decline in May, June rebounded again to 10.16 million square meters. Entering the third quarter, July-August supply declined, with July at 6.98 million square meters and August at 6.72 million square meters, both at annual lows, with year-on-year declines of 23.5% and 25.7% respectively; September, driven by the "Golden September" launch window, saw concentrated supply release to 13.68 million square meters, up 103.6% quarter-on-quarter, hitting a new monthly high for the year, but still down 15.7% year-on-year. Overall, supply in the first three quarters showed a pattern of "low start in Q1, surge and pullback in Q2, dip then rebound in Q3," with developers' launch pace clearly concentrated at a few nodes.

Figure 3: January 2023 to September 2026 Monthly Supply of New Commodity Residential Properties in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System. Note: The 50 representative cities include Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Hangzhou, Chongqing, Suzhou, Wuhan, Xi'an, Nanjing, Changsha, Tianjin, Zhengzhou, Dongguan, Qingdao, Ningbo, Hefei, Foshan, Shenyang, Wuxi, Jinan, Xiamen, Fuzhou, Wenzhou, Changchun, Harbin, Nanning, Changzhou, Nanchang, Nantong, Zhuhai, Huizhou, Xuzhou, Zhongshan, Lanzhou, Dalian, Dongying, Huainan, Jingdezhen, Kunshan, Lhasa, Shantou, Xining, Yangzhou, Yuncheng, Zhangzhou, Zhaoqing, Zhenjiang, and Zibo, the same below.

By city tier, supply in all tiers declined year-on-year in the third quarter, with second-tier cities seeing the deepest decline. The 4 first-tier cities had supply of 4.74 million square meters in the third quarter, up 7.1% quarter-on-quarter and down 15.7% year-on-year, with cumulative supply of 11.94 million square meters in the first three quarters, down 23.1% year-on-year. Shanghai and Shenzhen showed slightly weak supply in the third quarter, with both quarter-on-quarter and year-on-year declines; Beijing and Guangzhou saw concentrated releases, with quarter-on-quarter increases exceeding 20%, but cumulative year-on-year declines in the first three quarters still above 25%. The 23 second-tier cities had supply of 16.35 million square meters in the third quarter, down 12.4% quarter-on-quarter and down 24.6% year-on-year, with cumulative supply of 46.11 million square meters in the first three quarters, down 23.4% year-on-year. From third-quarter city performance, only Nanjing (+33.0%), Fuzhou (+36.5%), Suzhou (+21.0%), and Wuhan (+15.8%) achieved positive year-on-year growth, while Zhengzhou (-74.3%), Jinan (-70.3%), Chongqing (-56.9%), and Qingdao (-50.4%) saw declines exceeding 50%, with inter-city divergence intensifying. The 23 third- and fourth-tier cities had supply of 6.28 million square meters in the third quarter, up 4.3% quarter-on-quarter and down 11.2% year-on-year, with cumulative supply of 17.48 million square meters in the first three quarters, down 13.4% year-on-year. Zhuhai (+114.6%), Nantong (+47.4%), and Dongying (+28.9%) showed notable releases, but the absolute scale in most cities remained at historical lows.

Table 1: Q3 2026 and First Three Quarters New Commodity Residential Supply by City Tier in 50 Typical Cities (Unit: 10,000 square meters). Data source: CRIC China Real Estate Decision Consulting System.

Transactions: Q3 quarter-on-quarter decline of 26.3%, cumulative year-on-year decline of 11.1% in the first three quarters, with "Golden September" lacking luster. In the third quarter of 2026, overall new home transactions continued their bottoming trend. According to CRIC monitoring, new commodity residential transactions in 50 cities in the third quarter were 31.36 million square meters, down 26.3% quarter-on-quarter and down 10.6% year-on-year, with a cumulative year-on-year decline of 11.1% in the first three quarters. From the quarterly momentum perspective, the first quarter was affected by the Spring Festival and low base disturbances, with transactions at 30.02 million square meters, down 24.2% year-on-year; the second quarter benefited from the cumulative effects of policies and demand release in some core cities, with transaction area rebounding to 42.53 million square meters, up 41.7% quarter-on-quarter and basically flat year-on-year (+0.9%); entering the third quarter, the market shifted into a seasonal off-season, with transaction area falling back to 31.36 million square meters, down 26.3% quarter-on-quarter and down 10.6% year-on-year, with bottoming at the total level still incomplete. From the trend perspective, July transactions were 11.20 million square meters, the third-quarter high; August fell to 9.96 million square meters; September, under the dual effects of new policy implementation and "Golden September" marketing, slightly rose to 10.20 million square meters, up 2.4% quarter-on-quarter but with the year-on-year decline widening to 20.1%, showing that the "Golden September" clearly lacked luster.

Figure 4: January 2023 to September 2026 Monthly Transactions of New Commodity Residential Properties in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

By city tier, third-quarter transactions declined across the board quarter-on-quarter, with only some cities maintaining positive growth. First-tier cities were the only tier achieving positive year-on-year growth, confirming relative demand resilience with "the smallest decline and the most cities with positive growth." The 4 first-tier cities had third-quarter transactions of 5.04 million square meters, down 23.6% quarter-on-quarter but up 4.9% year-on-year against the trend, with cumulative transactions of 15.77 million square meters in the first three quarters, down 3.0% year-on-year, the smallest decline among all tiers. From third-quarter city performance, Shenzhen (+22.2%) and Beijing (+13.9%) achieved positive year-on-year growth, with concentrated release of upgrade demand providing clear support; Guangzhou (-4.5%) and Shanghai (-1.4%) saw slight year-on-year declines. Second-tier cities were under overall pressure, with uneven performance across individual cities. The 23 second-tier cities had third-quarter transactions of 18.73 million square meters, down 26.9% quarter-on-quarter and down 13.8% year-on-year, with cumulative transactions of 62.28 million square meters in the first three quarters, a year-on-year decline of 14.8%. From third-quarter city performance, apart from Shenyang (+11.9%), Suzhou (+17.4%), Xiamen (+13.2%), and Fuzhou (+29.0%), most cities were under pressure, with Changsha (-56.5%), Hangzhou (-27.9%), Chengdu (-27.9%), Qingdao (-28.7%), and Jinan (-34.2%) among the cities with the largest year-on-year declines. Third- and fourth-tier cities had third-quarter transactions of 7.59 million square meters, down 26.4% quarter-on-quarter and down 11.4% year-on-year, with the decline widening from the first half, demand remaining persistently weak, and cumulative transactions of 25.86 million square meters in the first three quarters, down 6.0% year-on-year, with the cumulative decline smaller than that of second-tier cities. From third-quarter city performance, Kunshan (+84.6%), Shantou (+15.8%), Xining (+11.2%), and Zhongshan (+5.1%) achieved positive year-on-year growth, commonly reflecting demand recovery from a low base, but absolute scale remained limited.

Table 2: Q3 2026 and First Three Quarters New Commodity Residential Transactions by City Tier in 50 Typical Cities (Unit: 10,000 square meters). Data source: CRIC China Real Estate Decision Consulting System.

From the transaction structure perspective, upgrade demand support continued, with a clear product upgrading trend. In January-September 2026 (cumulative basis), transactions of small units below 90 square meters accounted for only 18.5%, down 3.3 percentage points from 2023; the 110-130 square meter entry-level upgrade segment accounted for 26.3%, up 1.4 percentage points; units above 150 square meters accounted for 13.6%, up 2.9 percentage points, with the structural center of gravity continuing to shift upward. This structural upward shift is both a result of supply adaptation under the "good houses" policy guidance and means that effective new home demand is accelerating toward the upgrade end; new policies such as the 40-year personal loan cap and the upward adjustment of the debt-to-income ratio further lowered the threshold for upgrade housing swaps, making "shrinking total volume, rising structure" the main theme of the market. In specific cities, in January-September 2026, Hangzhou (31.1%), Suzhou (30.4%), and Ningbo (26.5%) had over 25% of transactions above 150 square meters, with Hangzhou and Suzhou exceeding 30%. Compared with the same period in 2025, 35 of the 50 representative cities saw an increase in the share of new home transactions above 150 square meters, with Suzhou, Hangzhou, and Nanchang rising by more than 5 percentage points; Shanghai (+2.0 percentage points), Guangzhou (+1.3 percentage points), and Shenzhen (+2.8 percentage points) all moved upward simultaneously, with upgrade demand becoming the main support for new home transactions in core cities.

Figure 5: 2023 to First Three Quarters of 2026 Share of New Commodity Residential Transaction Units by Area Segment in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

Prices: Overall year-on-year increase of 6.5% in the third quarter, first-tier cities still the only tier with a decline, with structural factors dominating gains and losses. From CRIC-monitored average transaction prices of new commodity residential properties in 50 cities in the third quarter of 2026, the overall average transaction price in 50 cities was 22,662 yuan per square meter, up 6.5% year-on-year but still down 1.1% quarter-on-quarter. By city tier, the first-tier city average price in the third quarter was 55,218 yuan per square meter, down 0.5% quarter-on-quarter and down 1.6% year-on-year, the only tier with a year-on-year decline; second-tier cities at 17,637 yuan per square meter, down 3.4% quarter-on-quarter but up 4.7% year-on-year; third- and fourth-tier cities at 13,421 yuan per square meter, down 1.5% quarter-on-quarter and up 3.7% year-on-year, with the average price recovery stemming more from the transaction structure tilting toward mid-to-high-end projects rather than a general increase in prices themselves.

Table 3: Q3 2026 Average Transaction Prices of Commodity Residential Properties by City Tier (Unit: yuan per square meter). Data source: CRIC China Real Estate Decision Consulting System.

From the monthly price trend, first-tier city average prices fell back from highs in the third quarter of 2026, while second-tier and third- and fourth-tier city average prices were relatively stable. In September, the first-tier city average transaction price was 52,441 yuan per square meter, down 4.6% from the beginning of the year; the second-tier city average transaction price was 17,254 yuan per square meter, up 1.7% from the beginning of the year; the third- and fourth-tier city average transaction price was 13,021 yuan per square meter, down 8.4% from the beginning of the year. Overall, the "stable with divergence" characteristic of third-quarter prices ran throughout, with first-tier cities fluctuating most due to the pace of high-end project launches, while third- and fourth-tier cities fluctuated narrowly at low levels under the "price-for-volume" strategy.

Figure 6: January 2023 to September 2026 Average Transaction Price Trends of New Commodity Residential Properties by City Tier in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

From city performance, among the 50 typical cities, 25 saw year-on-year increases in third-quarter average transaction prices, 10 were basically flat year-on-year (within the ±2% range), and 15 saw declines. The number of cities with increases clearly exceeded those with declines, but the distribution of gains and losses remained scattered, with structural characteristics of price changes still prominent.

Figure 7: Q3 2026 Year-on-Year Performance of New Commodity Residential Transaction Prices in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

Specifically, the top 10 cities by average transaction price were still mainly first-tier and strong second-tier cities, with Shanghai, Shenzhen, and Beijing firmly in the top three, and Hangzhou, Xiamen, and Guangzhou and other core cities in the Yangtze River Delta and Pearl River Delta in the top ten. Shanghai topped the list at 76,744 yuan per square meter, up 3.7% quarter-on-quarter but still down 7.6% year-on-year. Among the top 10 cities by quarter-on-quarter price change, Zibo (13.7%), Changsha (13.3%), and Qingdao (13.0%) ranked in the top three, while Shenyang, Changzhou, Zhongshan, Dongguan, and Xuzhou and other third- and fourth-tier and weak second-tier cities mostly rose by more than 5% quarter-on-quarter, while Fuzhou (-13.9%), Zhenjiang (-10.5%), and Guangzhou (-9.4%) had the largest quarter-on-quarter declines, with marginal price trends across cities clearly diverging. The top 10 cities by year-on-year price change showed significant divergence, with Dongying topping the list with a 31.1% year-on-year increase, followed by Qingdao (26.7%), Hangzhou (20.4%), Changsha (18.0%), and Zhaoqing (15.0%), with the share of third- and fourth-tier and weak second-tier cities rising noticeably, and high year-on-year gains still largely stemming from low bases and concentrated transactions in single projects; in contrast, Xi'an (-16.0%), Fuzhou (-11.2%), and Zhengzhou (-10.4%) saw year-on-year price declines exceeding 10%, with price adjustment pressure still relatively high.

Table 4: Q3 2026 Top 10 Cities by Average Commodity Residential Transaction Price and Price Growth (Unit: yuan per square meter). Data source: CRIC China Real Estate Decision Consulting System.

Inventory and Absorption: Total Safety and Structural Imbalance Coexist, Absorption Cycle Rises to 26.9 Months. In the third quarter of 2026, against the backdrop of continued supply contraction, the narrow inventory of commodity residential properties in 50 typical cities nationwide fell to 302 million square meters, down about 19.7% cumulatively from approximately 376 million square meters at the beginning of 2023, with overall inventory scale having returned to a three-year low. However, it is worth noting that end-September inventory rose 0.04% from end-June, with the year-on-year decline maintained at around 6.7%, basically flat from end-June, indicating that inventory absorption has entered a阶段性 plateau. This means that "production determined by sales" has indeed played a buffering role, and total inventory is no longer the main risk. But constrained by the overall low transaction scale, the absorption cycle rose instead of falling, reaching a stage high, with inventory pressure shifting from "total volume" to "absorption efficiency," and regional structural liquidity risks still accumulating.

Inventory: Narrow inventory enters a low-level plateau, second-tier cities remain the core bearer of inventory absorption. Since 2026, narrow inventory in key cities has continued to be in an absorption channel. As of end-September 2026, the total narrow inventory of commodity residential properties in 50 typical cities nationwide was approximately 302.21 million square meters, up slightly 0.04% from end-June and still down about 6.7% year-on-year. In September alone, inventory rose 1.2% quarter-on-quarter, ending several consecutive months of quarter-on-quarter decline. The reason is that developers concentrated launches during the "Golden September" window, with September supply surging 103.6% quarter-on-quarter, clearly exceeding the simultaneous transaction increase, causing short-term passive inventory replenishment; but over a longer period, the prudent operating strategy of "production determined by sales" is still deepening, with supply contraction generally exceeding transaction adjustment, and total inventory still in a year-on-year downward channel. By city tier, inventory in all tiers rose slightly quarter-on-quarter in September, with first-tier, second-tier, and third- and fourth-tier cities rising 2.3%, 1.1%, and 0.8% respectively, with first-tier cities leading the increase. From a year-on-year perspective, inventory in second-tier and third- and fourth-tier cities fell 7.6% and 6.6% respectively from the same period last year, with notable inventory destocking results; first-tier city inventory fell 3.0% year-on-year, the smallest decline among the three tiers.

Figure 8: January 2023 to September 2026 Changes in Narrow Inventory of Commodity Residential Properties in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

Specifically, inventory trends within first-tier cities diverged. Guangzhou (-7.2%) and Beijing (-5.2%) saw significant supply-side contraction, combined with transaction-side upgrade demand support, with inventory scale declining year-on-year in both, with Guangzhou inventory still reaching 16.12 million square meters, the highest among the four cities. Shanghai and Shenzhen inventory were still in an upward channel year-on-year, with Shenzhen up 7.0%, as inventory had not been effectively absorbed amid simultaneous supply and demand contraction, with slight inventory accumulation; Shanghai inventory was basically flat year-on-year. Second-tier city inventory overall showed a downward trend, with significant differences in existing stock volume across cities. Chengdu (23.98 million square meters), Shenyang (15.46 million square meters), and Wuhan (14.03 million square meters) ranked in the top three by end-September inventory, with the three cities totaling 53.47 million square meters, accounting for about 29.4% of total second-tier city inventory. On a year-on-year basis, 17 of the 23 second-tier cities saw inventory in a downward channel, with most cities' inventory declines mainly stemming from supply contraction exceeding transaction declines, such as Dalian (-48.3%), Changchun (-28.3%), Zhengzhou (-27.2%), and Hefei (-20.0%), with notable destocking results; only Chengdu (+8.8%), Jinan (+8.2%), Fuzhou (+8.8%), Suzhou (+6.5%), and Xi'an (+6.0%) and a few other cities saw positive year-on-year inventory growth due to the concentrated transmission of earlier supply. Third- and fourth-tier cities continued destocking, but "low total volume" and "high accumulation" coexisted. More than 80% of cities saw year-on-year inventory declines, with overall accumulation continuing to improve from the same period last year. Wenzhou (-24.4%), Changzhou (-17.0%), Nantong (-16.8%), and Xuzhou (-14.2%) had the largest year-on-year inventory declines, with inventory absorption accelerating. But Foshan, Shantou, Zibo, Zhuhai, and Xuzhou and other cities still had high absolute inventory levels, with relatively high absorption pressure. Only Dongguan (+28.4%) and Huainan (+3.3%) saw year-on-year inventory scale increases, with Dongguan inventory rising nearly 30%, mainly due to supply growth far exceeding transactions, causing passive inventory increases.

Figure 9: End-September 2026 Narrow Inventory and Year-on-Year Changes in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System. Note: For some cities, end-September inventory area = end-August inventory area + September supply - September transactions.

Absorption: Absorption cycle rises to 26.9 months, with weak second-tier and third- and fourth-tier cities as risk concentration areas. Along with the concentrated supply release at the end of the third quarter, as of end-September 2026, the commodity residential absorption cycle in 50 typical cities rose to 26.9 months, 0.6 months longer than at end-June. By city tier, the first-tier city absorption cycle was 24.7 months, slightly shortened by 0.2 months from end-June; second-tier cities at 25.5 months and third- and fourth-tier cities at 32.4 months, respectively 0.9 months and 0.5 months longer than at end-June, with third- and fourth-tier cities facing the most prominent absorption pressure.

Figure 10: January 2023 to September 2026 Changes in Commodity Residential Inventory Absorption Cycle in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System. Note: Absorption cycle = inventory area / average monthly absorption over the past 12 months.

Specifically, Shenzhen's absorption cycle was 22.9 months, with a year-on-year increase of 46.2%, at a stage high in absolute terms, with inventory pressure continuing to accumulate; Shanghai's absorption cycle was 18.8 months, with a year-on-year increase of 36.5%, mainly affected by transaction scale contraction, but its absolute level remained the lowest among the four first-tier cities. Beijing (30.5 months) and Guangzhou (25.9 months) saw absorption cycles rise 7.5% and 5.8% year-on-year respectively; although inventory scale declined year-on-year, constrained by overall transaction scale, absorption cycles remained at high levels, with inventory risks not fundamentally alleviated. Second-tier city absorption cycle risk stratification was clear, with core and weak second-tier city performance divergence intensifying. As of end-September, Dalian (69.3 months), Harbin (64.6 months), and Shenyang (58.2 months) and other weak second-tier cities had absorption cycles exceeding 56 months, significantly above the reasonable absorption range, with prominent inventory accumulation risks; in contrast, Chongqing (11.0 months), Hangzhou (11.3 months), Hefei (11.6 months), and Nanchang (13.7 months) had absorption cycles within the safe range of 14 months, with relatively balanced supply and demand. From year-on-year changes, with third-quarter transaction declines, most cities saw absorption cycles widen year-on-year, with Chengdu (+93.4%), Suzhou (+58.4%), Lanzhou (+41.8%), Hangzhou (+40.8%), and Jinan (+37.6%) among the cities with the largest year-on-year increases in absorption cycles, with absorption pressure rising significantly; only Dalian (-30.8%) and Changchun (-11.3%) benefited from substantial inventory clearing, with absorption cycles shortened year-on-year. Overall, second-tier city absorption pressure generally rose from the same period last year. Third- and fourth-tier cities faced a relatively severe overall inventory situation, with Zhuhai (53.9 months), Jingdezhen (52.4 months), Xining (51.2 months), Dongguan (46.7 months), Shantou (46.7 months), Kunshan (40.4 months), and Yuncheng (40.1 months) having absorption cycles exceeding 40 months; even if supply no longer increased, at the current transaction pace, absorption would still require more than 3 years. Year-on-year, most cities saw absorption pressure rise from the same period last year, with Xining (+70.4%), Dongguan (+53.7%), Zhuhai (+37.8%), and Jingdezhen (+34.5%) among the cities with the largest year-on-year increases in absorption cycles; only Nantong (-23.7%), Zibo (-13.2%), Kunshan (-12.1%), and Xuzhou (-11.2%) and a few other cities saw some alleviation.

Figure 11: End-September 2026 Absorption Cycle and Year-on-Year Changes in 50 Typical Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

Second-Hand Residential Market: Q3 Transactions Still Up 6.7% Year-on-Year, Resilience Significantly Better Than New Homes

In contrast to the continued volume contraction and adjustment in the new home market, the second-hand home market showed strong resilience in the third quarter, with transaction scale maintained at a high level under the main theme of "price-for-volume." In terms of total volume, second-hand residential transactions in 20 cities in the third quarter were 44.31 million square meters, down 16.8% from the second quarter but still up 6.7% year-on-year, with cumulative transactions of 139.06 million square meters in the first three quarters, up 6.5% year-on-year, maintaining a nearly four-year transaction high.

Figure 12: 2023 to First Three Quarters of 2026 Second-Hand Residential Transaction Trends in 20 Key Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

From the transaction trend, second-hand transactions peaked in the second quarter and then fell back, but resilience was significantly better than new homes. By month, second-hand residential transactions in 20 cities were 15.77 million square meters in July, further declining to 14.43 million square meters in August, and slightly falling to 14.11 million square meters in September, but still up 3.1% year-on-year, with the quarter-on-quarter decline narrowing to 2.2%, highlighting relative resilience.

Figure 13: January 2023 to September 2026 Second-Hand Residential Transaction Area and Quarter-on-Quarter Data in 20 Key Cities Nationwide. Data source: CRIC China Real Estate Decision Consulting System.

By city tier, first-tier cities had third-quarter transactions of 13.09 million square meters, down 13.5% quarter-on-quarter and up 8.0% year-on-year, with cumulative transactions of 40.66 million square meters in the first three quarters, up 5.7% year-on-year. Second- and third-tier cities had third-quarter transactions of 31.22 million square meters, down 18.2% quarter-on-quarter and up 6.2% year-on-year, with cumulative transactions of 98.40 million square meters in the first three quarters, up 6.8% year-on-year. Third-quarter year-on-year growth in first-tier cities surpassed second- and third-tier cities by 1.8 percentage points, and the quarter-on-quarter decline was also 4.7 percentage points smaller, indicating stronger short-term momentum in first-tier cities. In specific cities, Shanghai and Chengdu led in scale, with third-quarter transactions above 4.5 million square meters. From transaction performance, all city tiers saw quarter-on-quarter declines in third-quarter transactions, with only Ningbo maintaining positive growth, while Dalian, Hangzhou, and Xiamen had the largest declines, exceeding 25%. On a year-on-year basis, Shanghai, Suzhou, Ningbo, and Dongguan rose more than 20%. In the first three quarters, 16 of the 20 cities saw cumulative year-on-year positive growth, with Shanghai (+13.9%), Yangzhou (+24.4%), Suzhou (+19.8%), Huizhou (+19.0%), and Dongguan (+17.6%) among the cities with the largest increases.

Table 5: Q3 2026 and First Three Quarters Second-Hand Housing Transaction Volume by City Tier in 20 Key Cities (Unit: 10,000 square meters). Data source: CRIC China Real Estate Decision Consulting System.

Fourth Quarter Outlook

New Home Supply: End-of-Quarter Release Does Not Change the Broader Contraction Trend, Core Cities Remain the Launch Focus. Looking ahead to the fourth quarter, new home supply is expected to remain at a low level, but there is a possibility of concentrated release at year-end. From the third-quarter trend, July-August supply continuously declined to annual lows, and September, driven by the "Golden September" window, saw supply surge 103.6% quarter-on-quarter to 13.68 million square meters, a new monthly high for the year, showing that developers' launch pace is highly dependent on a few sales nodes rather than a systemic recovery in market confidence. It is expected that monthly supply in October-December may remain at a relatively high level; but the cumulative year-on-year -21.2% baseline in the first three quarters determines that fourth-quarter supply is unlikely to see a trend reversal. The constraint of land transaction contraction on sellable value in 2027 has already transmitted to the construction start end, and the 828 New Policy has established the institutional direction of completed housing sales. It is expected that fourth-quarter supply will still be mainly point-based releases under "production determined by sales, following market conditions," with the full-year supply year-on-year decline likely maintained at around -20%, and the policy's transmission to supply pace expected to gradually deepen in 2027. By city, core cities remain the launch focus. Hangzhou (absorption cycle 11.3 months), Hefei (11.6 months), Nanchang (13.7 months), and Chongqing (11.0 months) and other cities with low absorption pressure are expected to maintain launch enthusiasm in the fourth quarter, with new supply mainly high-quality "good houses" projects in prime locations; Zhengzhou, Tianjin, Nanning, and other cities with high inventory will see further supply contraction, with the market focus shifting to existing inventory absorption; third- and fourth-tier city supply is likely to continue at low volume, with some cities possibly seeing phased supply interruptions.

New Home Transactions: Low-Level Stabilization, Year-on-Year Decline Expected to Remain Stable. Looking ahead to the fourth quarter, new home transactions are expected to show "weak seasonal recovery, total volume stabilizing at a low level." Third-quarter transactions weakened overall, with the September year-on-year decline widening to 20.1%, and market momentum has been pressed to a low level; in the fourth quarter, under the combined effects of supply release, year-end promotions, and demand benefits from new policies such as 40-year personal loans and down payment optimization, transactions are expected to stage a quarter-on-quarter rebound, and the low base in the fourth quarter of 2025 will also help narrow the year-on-year decline, with the full-year new home transaction year-on-year decline expected to narrow to around -10%. At the city level, the structural divergence of "point-based heat, surface-based cold" will become more obvious: Beijing and Shenzhen transactions are expected to remain relatively stable, Hangzhou and Chengdu may fluctuate at high levels, Guangzhou, Nanjing, Suzhou, Wuhan, and other second-tier cities with relatively good fundamentals still have some room for small-scale volume release, while weak second-tier and most third- and fourth-tier cities will continue bottoming.

New Home Prices: Total Volume Stabilizing but Lacking Upward Momentum, Structural Divergence Continues. In the short term (Q4 2026), new home prices are expected to maintain a "total volume stabilizing, structural divergence" pattern. The stabilization of the 50-city first-three-quarter average transaction price at +1.0% year-on-year was mainly supported by second-tier upgrade projects, and this structural support will continue in the fourth quarter: first-tier city average prices will be underpinned by quality project launches, but a higher share of low-total-price projects may bring phased declines; Hangzhou, Hefei, and other hot second-tier cities will be dominated by upgrade projects, with average prices still having upward room, while Xi'an, Nanning, and other cities with high absorption pressure have not yet ended price adjustments; third- and fourth-tier cities will remain in a bottom-seeking process overall, with the "price-for-volume" strategy continuing through year-end. In the medium term (2027 and beyond), a higher share of completed and quasi-completed projects will strengthen the authenticity of new home prices, reducing the disturbance of "presale discounts" on statistical average prices, and new home prices may show phased gains; at the same time, supply contraction and concentrated upgrade demand may make core city price resilience better than weak-tier cities, with inter-city price divergence further solidifying.

Inventory and Absorption: Inventory to Continue Fluctuating Slightly, Structural Absorption Pressure to Persist. Looking ahead to the fourth quarter, the risk point on the inventory side lies in the "race between supply release and transaction recovery." In September, while supply surged quarter-on-quarter, transactions only rose 2.4% quarter-on-quarter, and supply release did not simultaneously translate into transactions; end-September inventory had already turned to quarter-on-quarter growth, and the absorption cycle rose to 26.9 months. If this "supply first, transactions lagging" rhythm continues in the fourth quarter, new supply may instead push up inventory replenishment pressure, and the absorption cycle could break through 27 months; conversely, if seasonal transaction recovery exceeds expectations, inventory may return to a downward path. Overall judgment: total inventory will still fluctuate narrowly around 300 million square meters, but structural absorption pressure will persist.

Second-Hand Home Transactions: High-Level Consolidation, Year-on-Year Growth Still Expected. The fourth-quarter second-hand home market is expected to maintain its relative advantage over new commodity residential properties, but transaction scale may decline further from the third quarter. In terms of transaction volume, second-hand transactions in the first three quarters were already at a historical high for the same period, with September alone at 14.11 million square meters, still up 3.1% year-on-year. The fourth quarter is a traditional off-season for transactions, and with previously accumulated demand gradually released, transaction volume may continue the quarter-on-quarter decline seen since the third quarter, but supported by a low base, year-on-year growth is still expected to remain positive. Core cities such as Shanghai, Shenzhen, and Tianjin, with large rigid-demand bases and relatively full price adjustments, are expected to maintain high transaction activity; Suzhou, Yangzhou, and other cities that released more demand earlier may face relatively greater transaction pullback pressure.

Appendix Table 1: Q3 2026 and First Three Quarters Average Transaction Prices of New Commodity Residential Properties by City Tier in 50 Typical Cities Nationwide (Unit: yuan per square meter). Appendix Table 2: End-September 2026 Narrow Inventory and Absorption Cycle of Commodity Residential Properties in 50 Typical Cities Nationwide (Unit: 10,000 square meters, months).