Soon, the supply of new homes will be drastically reduced.

Have you ever wondered, why did the existing-home sales policy come out in 2026? Not 2025, not 2027, but exactly in 2026.

Why is that?

The essence of this timing is a fundamental reversal of attitudes toward newly built residential properties sold off-plan.

Regarding the 828 policy, a friend of mine asked me: All clauses in this policy are favorable to the public, but unfavorable to developers. Why was such a policy introduced?

I think this may be the doubt of many people. Quite a number of industry policies are issued almost every year, but such a bold and far-reaching policy is extremely rare. Why was the 828 existing-home sales policy rolled out this year?

I thought for a moment and replied to him: Because ten years before 2026 is 2016. In 2016, two major policies were also launched in the history of real estate development: one is "Housing is for living in, not for speculation", the other is "Simultaneously promote housing rental and sales". Ten years have passed in the blink of an eye, do you still remember them?

01

To be honest, when the two policies of "Housing is for living in, not for speculation" and "Simultaneously promote housing rental and sales" were put forward in 2016, almost no one in the industry paid attention to them. Because at that time, the real estate industry was going through its heyday, the 330 policy in 2015 directly pushed the property market to its peak, almost every taxi driver would discuss with you which property to buy to earn more profits.

So at that time, many people thought these policies were just slogans, nothing more than empty remarks. Relying on inertial development momentum, the property market continued to grow at a high speed for several years until it peaked in 2021, and almost everyone had forgotten these two policies. But now, looking back ten years later, we have to admit that these two policies have achieved their goals successfully.

Now housing is no longer a target for speculative reselling, housing prices have not seen major fluctuations for many years, and the rights and interests obtained by buying and renting a house are now very close.

More importantly, the real estate industry has solved the rigid residential demand of individuals and families.

In 2021, 15 million residential units were transacted nationwide. For ten consecutive years before 2021, more than 10 million residential units were transacted across the country every year. The total transaction volume of these ten years adds up to more than 100 million residential units.

As of 2026, the real estate industry has experienced nearly 30 years of rapid development. Therefore, we have to accept a harsh reality: there are almost no remaining rigid residential demands in the market at this moment, the development of the industry has basically solved the per capita housing demand, which is why we dare to carry out such bold reforms on the real estate sector in 2026.

Then many people asked me if this policy is implemented in earnest. My answer to this question is: Do not hold any illusions, this policy is absolutely, completely and extremely seriously enforced.

In the past, real estate regulation was difficult, because the industry involved three factors: one is the people's livelihood related to residents' housing, the other is the construction that drives urban development, and the last is the development of the industry itself.

So in most cases, regulators dared not carry out thorough regulation, because on the one hand, the public needs housing, on the other hand, cities also need development and construction, which is why many people say there is a deviation between regulatory policies and actual implementation results.

But times have changed now, because the two most critical goals of the property market have been achieved: the public's rigid housing demand has been satisfied. Even if some people's demand is not fully met, renting a house is very comfortable now, or even better than buying a new off-plan property.

Moreover, urban development has shifted from large-scale urbanization to urban renewal, from extensive expansion to meticulous urban optimization. These two trend changes also indicate that the core mission of the real estate industry has been completed.

Frankly speaking, the industry itself is no longer as indispensable as before, which is why this policy has firm determination and will definitely be implemented unswervingly.

02

As for the future trend of newly built residential properties, we have published a related push article before.

Will the price of newly built homes rise after the new policy?

Many practitioners in the industry are discussing that the supply of newly built homes will become less and less. Most people's understanding and judgment are that as the policy is introduced, existing-home sales become more difficult, and the access threshold is raised, so the supply of newly built homes starts to decrease.

But today I want to put forward another perspective: many people think that the policy is introduced leading to the reduction of new home supply. But is it possible that the entire supply of newly built homes must be compressed in the future, so the policy is launched at this time.

First, the rise of the second-hand housing market is unstoppable. In the first half of this year, the transaction proportion of second-hand homes exceeded 50% for the first time, and this proportion will stay above 50% permanently in the future. Meanwhile, the National Bureau of Statistics released the macro data of August 2026, in which the online signing area of second-hand housing transactions was included for the first time.

All these signals indicate that from now on, second-hand homes will become the mainstream, and the extreme compression of the supply and demand of newly built homes in a short period is an inevitable trend of industry development.

This trend has been fully demonstrated in the United States and Japan. Japan has a population of 120 million, and the annual decommission volume of newly built homes is about 200,000 units now. The United States has a population of 340 million, and the annual decommission volume of newly built homes is about 750,000 units.

Converted according to the population base, rationally speaking, the annual sales volume of newly built homes across our country in the future will be about 3 million units, which is enough to meet the demand.

Now there are still 8 million units of newly built homes transacted nationwide every year, so I think this figure is far from the bottom, and the transaction volume of newly built homes will continue to decline.

This has nothing to do with policies, it is related to the development trend of the industry. Meanwhile, this trend has gradually emerged in Shanghai.

I wonder if you have noticed that the decline of the supply of newly built homes in Shanghai is very obvious. For a long period of time, the transaction volume of newly built and second-hand homes in Shanghai has remained at a relatively stable range: about 100,000 newly built homes are sold every year, and about 250,000 second-hand homes are sold every year, with a ratio of 1:2.5.

But do you know how many units of newly built homes are supplied in Shanghai now? The figure was about 40,000 units in 2025, and only 14,000 units in the first half of this year, the total supply is declining actively.

Don't be surprised if the annual supply of newly built homes in Shanghai drops to less than 10,000 units one day.

I think this is also in line with the development trend of the industry.

03

The reason why the supply of newly built homes must decline is that only by reducing the supply of newly built homes can we maintain the price stability of second-hand homes.

Please remember this judgment: the second-hand housing prices in Shanghai have not yet hit the bottom, and one of the important driving factors is that newly built homes are cheaper and of better quality.

With newly built homes as a reference, a rational customer will definitely choose newly built homes at this time. Recently, a newly built residential project in the suburbs of Shanghai has continuously triggered the points-based purchase restriction policy, precisely because it is cheap and of high quality.

The cost behind this is that the surrounding second-hand houses cannot be sold at all. So if second-hand houses want to gain competitiveness, they must continuously provide higher cost performance.

However, it is also very difficult to forcibly push up the price of newly built homes, because the current supply of newly built homes is still relatively large, especially the supply of new houses in the suburbs, and the current market system is already very fragile.

So the current trend of the entire property market ecology is ——

First, no matter the industry development or the improvement of access threshold brought by the existing-home sales policy, the reduction of newly built home supply has become an inevitable trend.

Second, when the supply of newly built homes decreases to the point that it becomes a niche track in the real estate industry, the market attention will almost all focus on second-hand homes. After second-hand homes lose a major competitor, the overall price range will start to stabilize.

Third, as the proportion of newly built homes starts to decline, the pricing of newly built homes can be relatively independent. No matter how high the price is, it will not seem abrupt and will not affect the fundamental pattern of the whole industry.

So in the end, the pattern of the entire property market is that the transaction proportion of newly built homes in the whole market drops to about 10%-20%.

The main market demand will be concentrated on second-hand homes, the price of second-hand homes will be stable and circulate in a market-oriented manner, and the annual transaction volume will also become stable. Newly built homes, as a niche and vertical track, will no longer be the focus of public opinion, thus realizing independent pricing.

Product quality can be fully released, becoming the specific choice for groups with ultimate improvement-oriented housing demand.

It is precisely because of this scenario deduction that the existing-home sales policy can be boldly promoted now.

The essence of existing-home sales is to force developers to output the best product quality, and the policy dimension is also looking forward to the emergence of better residential products.

So from this perspective, it is inevitable that newly built homes will become niche and vertical, and it is also inevitable that the price of newly built homes will rise.

But at that time, public opinion may not care so much about it, after all, there are a large number of second-hand homes with high cost performance for selection.

04

So after understanding this point, you will know that there is only one way for newly built homes to survive in the future: they must be completely different from second-hand homes, totally different.

If you still expect to adopt a homogenized + cost-effective strategy to operate new residential projects, being eliminated will become an inevitable result.

The quality differentiation of newly built homes mainly has several paths:

1. Non-standardization, that is, the single-project oriented operation. The standardized product line development model is no longer popular and cannot be adopted now, standardization is very risky, even high-end standardized products are no exception.

2. Transformation from residential functionality to user practicality. In the past, most second-hand houses focused on indoor space design, because they all emphasized the residential functionality of rooms. Now newly built homes need to realize the practical experience of the whole community, which is the fundamental purpose of supporting facilities, property services and community operation.

3. Post-operation development of single projects, such as property services, community operation, resource integration... Real estate is not only a residential space but also a family asset, and another identity of real estate is being awakened: a symbol of social status, the sense of identity and honor created by post-operation links will also become an important dimension of residential product quality in the future.

4. Absorb the quality standards of the commercial sector. Under the existing-home sales model, houses are commodities, following more mature commercial rules can also make projects stand out in the market, such as cash on delivery, what you see is what you get, seven-day no-reason return...

These concepts that are very common in the consumer goods industry but did not exist in the real estate industry in the past can also become the symbol of differentiation. Of course, if you still feel confused about this, you can take a look at the selection process of our recently shortlisted single-project oriented projects.

High-quality projects across the country have fully demonstrated these trends with practical operations, these changes will definitely emerge and be widely applied.

Essentially, after the supply of newly built homes is compressed, local governments also start to select high-quality developers for cooperation.

The land price may not be too high in the future, but developers must be required to create high-quality residential products.

Because the best destination for newly built homes, the final outcome of this track can be summed up in one sentence: The model of realizing premium profit by product quality will be fully tolerated and supported.

Allowing developers to make profits by developing one or two high-quality projects is the best future for both the industry and enterprises.

This article is from the WeChat official account "Zhen Jia Lusun", author: Zhen Jia Lusun, authorized to release by 36Kr.