China’s property industry is undergoing its sharpest contraction in a generation, with developers dramatically scaling back new housing projects in 2025 as financial pressures and weak demand reshape the sector, Caixin Global reports.
The outlet described the current situation as signalling “a decisive end to the country’s long expansion-driven property boom.”
Official data from the National Bureau of Statistics show that the amount of new residential construction begun nationwide fell 19.9 percent year on year in the first 11 months of 2025, dropping to 392 million square metres. New home sales also declined, falling 8.1 percent to 658 million square metres over the same period.
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As a result, the amount of new housing under construction has fallen well below the level of sales. Developers broke ground on less than 60 square metres of housing for every 100 square metres sold, pushing the starts-to-sales ratio down to 59.5 percent, the lowest level recorded since at least 2000.
According to Caixin, the property sector was now focussing on shrinking balance sheets and clearing excess inventory instead of expanding supply.
The figures highlight a sharp reversal from the industry’s expansion phase. From 1999 to 2014, rapid urbanisation drove sustained demand, with residential construction regularly exceeding sales and the starts-to-sales ratio often topping 110 percent and, at times, reaching 150 percent.
