China real estate prices improved marginally in April, but sales and construction remain under pressure

Overview

This report tracks China real estate market data for April 2026 across sales, prices, construction, land, and secondary home activity, and provides Goldman Sachs' forecast for May 2026. The core conclusion is that prices have shown marginal improvement, especially in tier-1 cities and some core tier-2 cities; however, new-home sales and construction activity remain weaker than Goldman Sachs expected, and the real estate fundamentals have not yet entered a broad-based recovery. Entering May, Goldman Sachs expects declines in average new-home and secondary-home prices to continue narrowing, but YoY declines in new-home sales value and area are likely to persist, while completions and starts should also remain down YoY.

Core views

First, prices are more resilient than transaction volumes. In April, both the 70-city new-home and secondary-home price indices fell 0.2% MoM, but the declines were mild, and tier-1 cities performed more strongly. Second, new-home sales remain under pressure, with nationwide sales area and sales value down 10% and 8% YoY in April, both below Goldman Sachs' expectations. Third, the secondary-home market improved relatively, with April transaction volume across 15 key cities turning positive YoY at 4%, and tier-1 cities up 6% YoY. Fourth, the construction chain remains weak, with completions and starts down 19% and 27% YoY in April, indicating that the property value chain has not yet recovered materially. Fifth, high-quality developers are still acquiring land cautiously in core cities, focusing on profitability and city tier rather than indiscriminate expansion.

Analysis framework

The report uses a monthly high-frequency tracking framework that combines National Bureau of Statistics data, CREIS land data, Centaline secondary-home transaction data, 58.com / Anjuke listing data, Beike price observations, rental and rental yield indicators, and Goldman Sachs' own GSPC completion tracking and developer land acquisition monitoring. It compares April actual performance against March trends, the prior-year base, and GSe forecasts, and then extrapolates the likely trends in May for sales, prices, construction, and secondary-home turnover.

Methodology notes

• High-frequency industry trackingChina real estate monthly tracking

  Cross-check real estate fundamentals through sales, prices, construction, land, rent, and secondary-home indicators.

  The report does not rely on a single indicator to judge the sector inflection point; instead, it observes new-home transactions, secondary-home transactions, the 70-city price index, completions, starts, land transactions, listing volume, rental yields, and developer land-acquisition margins at the same time.

• City-tier analysisTier-1, tier-2, and tier-3 city segmentation

  Compare housing prices, transactions, listings, and rent performance by city tier.

  The report argues that tier-1 cities and core tier-2 cities are supported by product upgrades, limited supply in core areas, and resilient rents, leading to better price performance than lower-tier cities.

• Developer profitability monitoringLand spending and project gross margin monitoring

  Assess developer investment discipline using land spending as a share of contracted sales, city distribution, and project-level GPM.

  The report tracks new land reserves for six developers and shows that their April land spending was about 27% of contracted sales, project-level gross profit margin was about 24%, and the majority of exposure was concentrated in tier-1 and tier-2 cities as well as Top-10 cities.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Chinese real estate developer equities

  Directly related

  Strengths

  Improving housing prices in core cities, recovering secondary-home transactions, and prudent land acquisition by high-quality state-owned developers support earnings quality and market expectations.

  Weaknesses

  New-home sales and construction activity remain weak, with clear YoY declines in completions, starts, and real estate development investment.

  Comparison

  Stronger state-owned developers are more aggressive in acquiring land in core cities and have more stable margins, outperforming developers with greater exposure to lower-tier cities or weaker balance sheets.

  Risks

  Sales recovery falls short of expectations, policy stimulus is insufficient, the land market continues to weaken, and secondary-home listing pressure rebounds.

• Chinese residential market

  Core research object

  Strengths

  Tier-1 city housing prices and rents are more resilient, and some core tier-2 cities may turn positive on a MoM basis.

  Weaknesses

  Nationwide new-home sales remain down YoY, and price pressure in lower-tier cities remains significant.

  Comparison

  Tier-1 cities are significantly stronger than lower-tier cities, while the degree of improvement in core tier-2 cities may lie between the two.

  Risks

  A high base makes YoY pressure larger in May, and buyer confidence recovery remains insufficient.

• Chinese land market

  Leading and margin-monitoring indicator

  Strengths

  High-quality developers are concentrating land acquisition in tier-1 and tier-2 cities as well as Top-10 cities, with project-level GPM around 24%.

  Weaknesses

  Nationwide land transaction area and amount still fell 26% and 34% YoY in April, respectively.

  Comparison

  The tracked strong state-owned developers performed better than the overall land market.

  Risks

  Persistently weak land transactions may pressure local fiscal revenue, development investment, and future supply.

• Secondary-home and residential leasing markets

  Market sentiment and supply-demand pressure indicators

  Strengths

  Secondary-home transactions in 15 key cities turned positive YoY, rental yields improved marginally, and rents in tier-1 cities rose MoM for two consecutive months.

  Weaknesses

  Online home-search activity edged down MoM in April, and while listings were down YoY, they rose slightly MoM.

  Comparison

  Secondary-home transaction performance is better than new-home sales, and tier-1 city rent performance is better than the 50-city average.

  Risks

  If listing volume rises again or rents weaken, stabilization in secondary-home prices may be hindered.

Key data

• Nationwide commodity housing sales in AprilArea YoY -10%, amount YoY -8%For 4M26, sales area and amount were -10% and -15% YoY, respectively.
• Nationwide commodity housing average price in AprilMoM +13%, YoY +2%For 4M26, average price was -5% YoY.
• 70-city new-home price indexApril MoM -0.2%Tier-1, tier-2, and tier-3 cities were +0.1%, -0.1%, and -0.3%, respectively.
• 70-city secondary-home price indexApril MoM -0.2%Tier-1, tier-2, and tier-3 cities were +0.4%, -0.2%, and -0.4%, respectively.
• Secondary-home transactions in 15 key citiesApril MoM +7%, YoY +4%For 4M26, the figure was -5% YoY; tier-1 cities were +6% YoY in April.
• April completions areaYoY -19%For 4M26, completions area was -24% YoY, below GSe's expectation of about a 10% YoY decline.
• April starts areaYoY -27%For 4M26, starts were -22% YoY, weaker than GSe's expectation of a mid-teens decline.
• April real estate development investmentYoY -20%For 4M26, real estate development investment was -14% YoY.
• Land transactions in AprilArea YoY -26%, amount YoY -34%For 4M26, land transaction area and amount were -20% and -37% YoY, respectively.
• Land acquisitions by six tracked developers in AprilLand spending was about 27% of contracted sales, with project-level GPM around 24%97% exposure to tier-1 and tier-2 cities, 71% exposure to Top-10 cities.

Impact & implications

The report's implication for Chinese real estate assets is more structural than broadly optimistic. Narrower price declines and the return of positive YoY secondary-home transactions should help repair market sentiment, particularly supporting core-city exposure and high-quality state-owned developers; however, new-home sales, completions, starts, and real estate investment remain weak, indicating that demand and the construction chain have not yet entered a strong recovery. If purchase restrictions in tier-1 cities are further eased, housing provident fund reforms are implemented, or other policy stimulus measures are rolled out, the expectation of price stabilization in core cities could strengthen; otherwise, if sales continue to miss expectations or secondary-home listing pressure rises again, the pace of recovery may still be delayed.

Risks

• The YoY decline in new-home sales area and value continues, and demand recovery is weaker than expected.
• Completions and starts continue to decline by double digits, indicating insufficient improvement in the property construction chain.
• If secondary-home listing supply pressure rises again, it could weigh on price stabilization.
• The pace or scale of policy stimulus is below market expectations.
• Price and inventory pressure in lower-tier cities spills over, dragging down nationwide average prices and developer confidence.

What to watch

• Whether core tier-1 cities such as Shanghai and Shenzhen show price stabilization or an inflection point.
• Whether other core tier-2 cities follow tier-1 cities and turn positive on a MoM basis.
• Whether secondary-home listings continue to decline YoY and whether rental yields improve further.
• Whether purchase restrictions in tier-1 cities are fully eased, whether housing provident fund reforms are introduced, or whether a new round of real estate stimulus policies is launched.
• Whether May new-home sales, secondary-home transactions, completions, and starts match Goldman Sachs' forecasts.