Housing market measures will help

Following earlier steps, on Sept 30 the key regulators on the property market formally announced a set of measures to support the housing market. We do not expect this package to lead to a rapid recovery of the real estate sector. Nonetheless, in our view these measures are substantial enough to improve sentiment and sales on the property market. But what about the overall growth outlook?

Since the housing market slowdown started to bite and overall economic growth started to disappoint early this year we have been expecting policymakers to relax property market policies. In our view, such relaxation of property policies is part of a broader effort by policymakers to support growth, even though - based on recent comments by senior policymakers - we do not expect very large and high profile measures.

Following some earlier steps, on Sept 30 the the People's Bank of China and the China Banking Regulatory Commission formally announced a set of measures to support the housing market.