China House Price Index YoY: November 2025 Analysis and Macro Outlook
Key Takeaways: China’s House Price Index (HPI) YoY held steady at -2.20% in November 2025, matching October’s reading but showing marked improvement from early 2025 lows near -5%. The persistent negative trend reflects ongoing real estate sector challenges amid cautious monetary policy and subdued demand. Fiscal stimulus and easing financial conditions offer some support, but external risks and structural shifts temper optimism. Forward scenarios range from gradual stabilization to renewed downside risks if credit tightens or geopolitical tensions escalate.
Table of Contents
The latest data from the Sigmanomics database shows China’s House Price Index (HPI) year-over-year change remained at -2.20% in November 2025, unchanged from October but significantly improved from the -5.00% recorded in February 2025. This signals a persistent but moderating contraction in housing prices amid a complex macroeconomic backdrop.
Drivers this month
- Continued weak demand in tier-2 and tier-3 cities.
- Government measures supporting mortgage lending and property developers.
- Stable but cautious buyer sentiment amid economic uncertainty.
Policy pulse
The HPI remains below zero, reflecting ongoing sector stress despite monetary easing efforts. The People’s Bank of China (PBOC) has maintained accommodative policy but refrained from aggressive rate cuts, balancing inflation control and growth support.
Market lens
Immediate reaction: The CNY/USD pair showed mild depreciation of 0.10% post-release, reflecting cautious investor sentiment. Short-term bond yields edged lower, signaling modest easing expectations.
Core macroeconomic indicators provide essential context for the housing market’s trajectory. China’s GDP growth slowed to an estimated 4.50% YoY in Q3 2025, down from 5.20% in Q2, reflecting weaker domestic demand and export headwinds. Urban fixed asset investment rose 3.80% YoY, a slowdown from previous quarters, indicating restrained capital deployment in real estate and infrastructure.
Monetary Policy & Financial Conditions
The PBOC’s benchmark lending rate stands at 3.65%, unchanged since mid-2025. Liquidity injections via medium-term lending facilities have increased by 15% YoY, aimed at stabilizing credit flows to property developers and homebuyers. However, tighter regulatory scrutiny on shadow banking and leverage limits continues to constrain credit expansion.
Fiscal Policy & Government Budget
Fiscal stimulus measures include increased local government special bond issuance, up 20% YoY, earmarked partly for affordable housing projects. The central government’s budget deficit widened to 3.20% of GDP in 2025, reflecting targeted spending to support economic stabilization and social housing.
Drivers this month
- Moderate price rebounds in major cities like Shanghai and Beijing.
- Government incentives for first-time homebuyers.
- Improved liquidity for developers reducing forced sales.
Policy pulse
The steady HPI decline suggests that monetary and fiscal policies have so far prevented a sharper downturn but have not yet triggered a full recovery. The central bank’s cautious stance reflects concerns about inflation and financial stability.
Market lens
Immediate reaction: The SHIBOR 1-month rate dropped 5 basis points, signaling easing short-term credit costs. The Shanghai Composite Index rose 0.40%, reflecting tentative investor optimism in real estate-related sectors.
This chart highlights a clear trend of moderating house price declines, reversing the steep falls seen in early 2025. The data suggest a fragile stabilization phase, with policy support playing a key role in preventing further deterioration.
Looking ahead, the trajectory of China’s housing market depends on multiple factors, including domestic demand recovery, credit availability, and external shocks. We outline three scenarios with assigned probabilities:
Bullish scenario (30%)
- Stronger-than-expected economic growth above 5% in 2026.
- Further monetary easing and fiscal stimulus boosting housing demand.
- House Price Index turns positive by mid-2026, supported by urbanization trends.
Base scenario (50%)
- Gradual economic stabilization around 4.50% growth.
- Continued moderate policy support maintaining HPI near -2% to -1%.
- Slow recovery in buyer confidence and developer balance sheets.
Bearish scenario (20%)
- Renewed credit tightening or regulatory shocks.
- Geopolitical tensions impacting exports and investor sentiment.
- HPI declines deepen below -3%, risking broader financial sector stress.
Structural & Long-Run Trends
China’s demographic shifts, including an aging population and slower household formation, weigh on long-term housing demand. Urban migration patterns and government emphasis on rental markets and affordable housing will reshape the sector’s dynamics over the next decade.
China’s House Price Index YoY data for November 2025 reflect a housing market in cautious recovery but still under pressure. Policy measures have stabilized prices, yet structural headwinds and external risks remain. Market participants should monitor credit conditions, fiscal policy adjustments, and geopolitical developments closely. The balance of risks suggests a slow, uneven recovery rather than a sharp rebound.
Key Markets Likely to React to House Price Index YoY
The House Price Index YoY in China influences several key markets, including equities, currency, and credit instruments. Real estate-related stocks and financial sector equities often track housing trends closely. The Chinese yuan’s value reflects macroeconomic confidence tied to domestic demand and policy outlook. Additionally, crypto markets with exposure to Chinese investor sentiment may see correlated moves.
- 000001.SZ – Shenzhen Component Index, sensitive to real estate and financial sector performance.
- 601318.SH – Ping An Insurance, a major insurer with exposure to mortgage and property markets.
- USDCNY – Chinese yuan exchange rate, reflecting macroeconomic and policy sentiment.
- BTCUSDT – Bitcoin tethered pair, often influenced by Chinese investor risk appetite.
- 000333.SZ – Midea Group, a large home appliance maker linked to housing demand trends.
Insight: House Price Index vs. 000001.SZ Since 2020
Since 2020, the Shenzhen Component Index (000001.SZ) has shown a moderate positive correlation (~0.45) with China’s House Price Index YoY. Periods of sharp HPI declines, such as early 2025, coincided with equity market pullbacks in real estate and financial sectors. Conversely, stabilization in housing prices has supported equity rebounds. This relationship underscores the importance of housing market health for broader market sentiment.
FAQs
- What does the China House Price Index YoY indicate?
- The China House Price Index YoY measures the annual percentage change in residential property prices, reflecting market trends and economic conditions.
- How does the House Price Index impact China’s economy?
- Housing prices affect consumer wealth, construction activity, and financial stability, influencing GDP growth and policy decisions.
- What are the risks to the China housing market outlook?
- Risks include credit tightening, regulatory changes, demographic shifts, and external geopolitical tensions that could depress demand and prices.
China’s housing market shows tentative signs of stabilization but remains vulnerable to policy shifts and external shocks. Close monitoring of credit flows and government measures is essential for anticipating future trends.
Sources
- Sigmanomics database, China House Price Index YoY, November 2025 release.
- People’s Bank of China Monetary Policy Reports, 2025.
- National Bureau of Statistics of China, Q3 2025 GDP and Investment Data.
- Ministry of Finance of China, Fiscal Budget Reports 2025.
The November 2025 HPI YoY reading of -2.20% matches October’s figure and marks a significant improvement from the -5.00% low in February 2025. The 12-month average HPI decline stands at approximately -3.30%, indicating a steady recovery trend over the past nine months.
Monthly data reveal a gradual easing of price declines, with the index improving from -4.80% in March and -3.50% in June, reflecting the impact of policy support and stabilizing buyer confidence.