H1 2025 China Judicial Auction Market: Total Transaction Volume Rebounds Amid Persistent Downward Price Pressure

From January to June 2026, in the national judicial auction market, the cumulative number of various judicial auction housing listings put up for auction reached about 463,000 units, with about 103,000 units sold, and the total transaction value reached about 151.5 billion yuan.

From January to June 2026, a total of approximately 463,000 foreclosed properties were listed for auction in the national judicial auction market, with around 103,000 units successfully transacted, generating a total transaction value of about 151.5 billion yuan. The overall market presents a pattern of "rising volume and falling prices, with structural differentiation."

In terms of total volume changes, the judicial auction market in the first half of 2026 exhibits the following characteristics:

Stable yet growing listing volume: The number of foreclosed properties listed nationwide in the first half of the year increased by approximately 23.1% compared to the same period in 2025 (around 376,000 units), reflecting that asset disposal demand during the economic restructuring period continues to be released.

Slight rebound in transaction volume: About 103,000 units were transacted in the first half of the year, representing a 29.8% increase from the roughly 79,000 units in the first half of 2025. The clearance rate stood at approximately 22.2%, up by about 1.1 percentage points from the same period in 2025.

Synchronized rebound in transaction value amid price pressure: The total transaction value reached around 151.5 billion yuan, marking a 17.6% year-on-year increase. The average transaction price of residential foreclosed properties was approximately 8,165 yuan per square meter, a decline from the same period in 2025, continuing the overall trend of price pressure in the judicial auction market.

Analysis of Transaction Structure by Property Type

Residential foreclosed properties remain the absolute dominant force in the market, accounting for about 71% of the total transaction units and approximately 53% of the total transaction value. The average transaction price of residential properties, around 8,165 yuan per square meter, has further declined compared to the same period in 2025, highlighting the distinct "trading volume for price" feature in the residential judicial auction segment. Commercial judicial auction transactions continue to be sluggish, with a clearance rate of only 15.6%, indicating significant market destocking pressure.

Divergent Performance of Residential Foreclosed Properties Across Tiered Cities

In the first half of 2026, the residential judicial auction market in cities of different tiers presents a differentiated pattern: "first-tier cities remain resilient, second-tier cities see a rebound, and third- and fourth-tier cities focus on volume expansion."

In first-tier cities (Beijing, Shanghai, Guangzhou, Shenzhen), the average transaction price of residential foreclosed properties reaches 33,369 yuan per square meter, with a clearance rate of 60.9%, significantly higher than the national average. Among them, the clearance rate of residential foreclosed properties in Beijing is approximately 51.3%, while Shanghai records a clearance rate of about 76%, with high-quality properties in core locations still sought after by the market.

The average transaction price of residential foreclosed properties in second-tier cities is around 8,494 yuan per square meter, with a clearance rate of 43.1%. Cities like Hangzhou, Chengdu, and Chongqing show active performance. Notably, Hangzhou's residential judicial auction clearance rate exceeds 69.6%, with an average transaction price of approximately 18,222 yuan per square meter, ranking among the top in second-tier cities.

Third- and fourth-tier cities prioritize "volume-driven" transactions for residential foreclosed properties, with an average transaction price of about 4,896 yuan per square meter and a clearance rate of roughly 29.7%, facing substantial downward price pressure.

Ranking of Transaction Value by Province and Municipality

In the first half of 2026, the transaction value of the judicial auction market across provinces and municipalities presents a pattern: "Guangdong, Zhejiang, and Jiangsu lead the nation, while Beijing and Shanghai boast high unit prices":

Guangdong Province continues to top the national ranking with a transaction value of 27.8 billion yuan, leading the country in judicial auction transaction activity. Zhejiang Province ranks among the top provinces with a clearance rate of 48.4%, with cities like Hangzhou and Wenzhou performing exceptionally well. Although Beijing and Shanghai have a relatively small number of transaction units, their average transaction prices are high, placing their total transaction values at 4th and 5th positions nationwide respectively.

Auction Stage Analysis: Rising Proportion of First Auction Transactions

From the perspective of the auction stages of transacted properties, in the first half of 2026: approximately 42,000 units were transacted in the first auction, accounting for about 40.1% of the total transaction volume, representing an increase of about 2.4 percentage points compared to the same period in 2025. This indicates that the proportion of foreclosed properties successfully transacted during the initial auction stage has rebounded. Around 47,000 units were transacted in the second auction, making up roughly 45.6% of the total, which remains the primary transaction stage.

About 12,000 units were transacted through sale with legal remedies and other channels, accounting for approximately 11.6% of the total.

The average transaction price in the first auction is around 6,913 yuan per square meter, while the average in the second auction is about 4,720 yuan per square meter, with a second-auction discount rate of approximately 67%. Buyers can access greater price discount space during the second auction phase.

Overview of Residential Judicial Auction Markets in Key Cities

Chongqing: Around 29,000 new auction properties were listed in the first half of the year, with a total of about 39,000 units available for transaction, approximately 6,786 units transacted, a clearance rate of roughly 17.3%, an average transaction price of about 3,579 yuan per square meter, and a transaction discount rate of approximately 56.6%. Yubei District and Jiulongpo District are the core transaction areas.

Chengdu: Approximately 2,500 units were transacted through judicial auctions in the first half of the year, with a clearance rate of around 13.7%, an average transaction price of roughly 6,391 yuan per square meter, and a transaction discount rate of about 76%. Its market activity continues to lead the southwest region of China.

Hangzhou: About 2,130 units were transacted via judicial auctions in the first half of the year, with a clearance rate of approximately 47.3%, an average transaction price of roughly 9,845 yuan per square meter, and a transaction discount rate of about 75%. Its clearance rate ranks among the top major cities nationwide.

Beijing: Around 1,547 units were transacted through judicial auctions in the first half of the year, with a clearance rate of approximately 35%, an average transaction price of roughly 29,802 yuan per square meter. Chaoyang District records a clearance rate exceeding 45.5%, demonstrating strong liquidity of high-quality assets in core urban areas.

Market Outlook

In the first half of 2026, the policy environment for the foreclosed property market continued to optimize. Multiple regions including Zhongshan and Suzhou further clarified the operational rules for purchasing foreclosed properties using provident fund loans, allowing buyers to acquire such properties through provident fund loans with the loan amount, ratio, and term following the standards applied to second-hand housing transactions. The implementation of these policies effectively lowered the transaction threshold for foreclosed properties and boosted market participation enthusiasm.

Looking ahead to the second half of 2026, the judicial auction market is expected to present the following trends:

1. Sustained high total volume: Driven by economic restructuring and improved judicial enforcement efficiency, the supply of foreclosed properties is projected to maintain steady growth.

2. Deepening price differentiation: Residential foreclosed properties in core areas of first-tier cities will maintain strong price support, while prices in third- and fourth-tier cities will still face downward pressure.

3. Continuous release of policy dividends: Policies such as allowing the use of provident fund loans to purchase foreclosed properties are expected to be implemented in more cities, further stimulating market demand.

4. Increased participation of professional institutions: As the market becomes more standardized, more financial institutions, asset management companies, and professional investors will actively engage in the judicial auction market.

This article is sourced from the WeChat Official Account "China Index Academy", authored by China Index Research, and published by 36Kr with authorization.