China’s National Bureau of Statistics data for December 2025 show a broad cooling of the property market across 70 major and medium-sized cities, with both month-on-month and year-on-year price declines deepening in most places. New-home prices in first-tier cities fell 0.3% from November and were down 1.7% versus a year earlier, while second‑hand home prices in those same cities dropped 0.9% month-on-month and 7.0% year-on-year. The picture is consistent across lower tiers: second-hand prices in tier‑2 and tier‑3 cities each fell 0.7% month-on-month and 6.0% year-on-year, signalling widespread weakness in transactions and valuations.
Beneath the aggregate figures there are sharp geographic divergences. Shanghai bucked the trend: new-home prices there rose 0.2% month-on-month and 4.8% year-on-year, making it a clear outlier among the four first-tier municipalities. Beijing, Guangzhou and Shenzhen all recorded declines in both new and second-hand segments — Beijing’s second-hand stock was particularly weak, down 1.3% month-on-month and 8.5% year-on-year. That divergence points to a two-speed market in which a small set of global gateway cities or segments (notably high-end supply in Shanghai) continue to attract demand while broad-based purchasing activity softens elsewhere.
The slump is more than a quarterly quirk: year-on-year declines widened in December across tiers and market segments, indicating persistent downward pressure rather than short-term noise. New-home prices in tier‑2 and tier‑3 cities were down 2.5% and 3.7% year-on-year respectively, and month-on-month falls in new-home prices were 0.4% in both tiers. The sustained weakness in second-hand markets — which tend to reflect household sentiment and financing conditions more quickly than new sales — amplifies the concern that lower transaction volumes are translating into price adjustments.
The statistical exercise covers the urban districts of 70 cities (excluding counties) and classifies them into tier groups: first-tier comprises Beijing, Shanghai, Guangzhou and Shenzhen; tier‑2 and tier‑3 encompass 31 and 35 other cities respectively. New-home price measures rely on comprehensive local contract (online signing) data from real estate management authorities, while second‑hand price series combine focused surveys and reported transaction prices from brokerages and housing service platforms.
Why this matters: China’s property market remains a dominant force in the economy, shaping household wealth, local government revenues (via land sales) and developers’ cash flow. The widening year-on-year declines suggest fragile demand and depressed turnover, which could feed through to weaker consumption and slower investment if not arrested. Policymakers face a familiar trade-off: broad stimulus risks reigniting speculation in the wrong places, while too little support risks further price falls and financial stress among leveraged developers and mortgage-laden households.
The near-term outlook is mixed. The modest narrowing of some month-on-month declines hints at tentative stabilization in parts of the market, but the larger year-on-year deterioration shows the adjustment is far from complete. Expect policymakers to favour targeted measures — mortgage-rate adjustments, purchase-rule refinements, and local demand-support measures — over large-scale national stimulus, while investors and banks watch transaction volumes, inventory levels and local government land-sale receipts for signs of a durable turnaround.