GRA Market Weekly (2026-01-18)

Macro Policy

MOHURD, MOF and STA jointly extend the individual income tax rebate policy for residents switching homes

On 14 January, the Ministry of Housing and Urban-Rural Development (MOHURD), the Ministry of Finance and the State Taxation Administration, to continue supporting housing upgrades, jointly issued the Announcement on Continuing the Individual Income Tax Policy Supporting Residents Switching Homes. The announcement provides that from 1 January 2026 to 31 December 2027, taxpayers who sell their own home and repurchase on the market within one year of the sale are entitled to a rebate of the individual income tax paid on the sale. Key provisions:

1. From 1 January 2026 to 31 December 2027, taxpayers who sell their own home and repurchase within one year of the sale qualify for a rebate of the individual income tax paid on the sale. Where the new home's purchase price is equal to or greater than the transfer price of the existing home, the tax paid is refunded in full; where it is lower, the refund is pro-rated to the ratio of the new purchase price to the transfer price.
1. The transfer price of the existing home refers to its market transaction price. For a new-build purchase, the purchase price is the transaction price stated in the purchase contract registered online with the housing authorities; for a secondary purchase, it is the transaction price of the home.
1. Eligible taxpayers must simultaneously satisfy: (1) the home sold and the home repurchased must be within the same city, defined as the full administrative area of the same municipality, sub-provincial city or prefecture-level city (prefecture, autonomous prefecture or league); (2) the seller must be directly connected to the newly purchased home, i.e. be its owner or one of its owners.

MOF and STA extend tax incentives for public rental housing

On 16 January, the Ministry of Finance and the State Taxation Administration announced the continuation of tax incentives for public rental housing. Core provisions:

1. Land used during construction of public rental housing and land occupied after completion is exempt from urban land use tax.
1. Operators of public rental housing are exempt from stamp duty relating to its construction and management.
1. Purchases of housing by operators for use as public rental housing are exempt from deed tax and stamp duty; both parties to public rental leases are exempt from stamp duty on the lease agreements.
1. Transfers of old properties by enterprises, public institutions, social organisations and other entities for use as public rental housing are exempt from land appreciation tax where the appreciation does not exceed 20% of deductible items.
1. For enterprises, public institutions, social organisations and other entities donating housing as public rental housing in compliance with tax laws, charitable donation expenses within 12% of annual total profit are deductible in computing taxable income, and the excess may be carried forward for deduction over the following three years; for individuals donating housing as public rental housing, charitable donation expenses within 30% of declared taxable income are deductible.
1. Housing rental subsidies received from local governments by qualifying urban households under housing support schemes are exempt from individual income tax.
1. Public rental housing is exempt from real estate tax; rental income from operating public rental housing is exempt from VAT.

Targeted Policies

PBOC: room remains for RRR and interest rate cuts in 2026

On 15 January 2026, the People's Bank of China (PBOC) announced a 25 bps cut to relending and rediscount rates effective 19 January. After the cut, the 3-month, 6-month and 1-year relending rates for agriculture and small business stand at 0.95%, 1.15% and 1.25% respectively; the rediscount rate at 1.5%; the pledged supplementary lending (PSL) rate at 1.75%; and the rate on special structural monetary policy tools at 1.25%.

The same day, PBOC spokesperson and Deputy Governor Zou Lan announced two sets of measures at a State Council Information Office press conference: first, a 25 bps cut to rates on all structural monetary policy tools, to sharpen banks' incentives to lend to priority sectors; second, refining the structural tools for tech innovation, private enterprises and the green transition and stepping up support, to further aid the optimisation of the economic structure.

PBOC: minimum down payment on commercial-property loans to be cut to 30%

On 15 January, the State Council Information Office held a press conference on how monetary and financial policy has supported high-quality development of the real economy. PBOC spokesperson and Deputy Governor Zou Lan said the central bank would work with the National Financial Regulatory Administration to lower the minimum down payment ratio on commercial-property purchase loans to 30%.

Market Watch

Shanshan Group's Shanghai headquarters tower back at auction with a RMB 450 m price cut

On 13 January 2026, Junkang Financial Plaza went to a second auction on Alibaba's judicial auction platform with a reserve price of RMB 1.81 bn, a deposit of RMB 181 m and an appraised value of RMB 3.203 bn (the asset had failed to sell at auction on 8 January 2026 at a reserve of RMB 2.26 bn). The site covers 22,281.00 sqm with GFA of 104,092.20 sqm, comprising 58,215.25 sqm above ground and 45,876.95 sqm below ground. Junkang Financial Plaza is a Grade A office cluster in the Houtan CBD of Pudong, Shanghai, made up of five petal-shaped standalone buildings with total GFA of c. 105,400 sqm, adjacent to the Huangpu River and served directly by Houtan Station on Metro Line 7. The project was formerly the headquarters of Shanshan Group; it has changed hands repeatedly amid the group's debt troubles and is currently in judicial auction.

KKR closes USD 2.5 bn Asia private credit fundraise

On 15 January, global investment firm KKR announced the close of USD 2.5 bn in Asia private credit capital, to be deployed primarily into high-quality private-market credit assets across Asia Pacific. The raise comprises the USD 1.8 bn KKR Asia Credit Opportunities Fund II ("ACOF II") and USD 700 m in separately managed accounts targeting similar opportunities.

Hong Kong court orders winding-up of Jingrui Holdings

According to the Hong Kong Judiciary website, the High Court of the Hong Kong SAR issued a winding-up order against Jingrui Holdings on 15 January. The judgment shows that China CITIC Financial Asset International Holdings (the petitioner) filed a winding-up petition against the company on 8 October 2024 on grounds of insolvency, claiming nearly USD 160 m in unpaid debt.

Founded in Shanghai in 1993 and listed in Hong Kong in 2013 (1862.HK), Jingrui Holdings is a long-established developer whose businesses span residential development and the management of apartment and office assets. The company is mired in a debt crisis: CITIC Financial brought the winding-up petition in 2024 over c. USD 108 m of unpaid loans, with hearings repeatedly adjourned to 26 August 2025. Its onshore subsidiary Jingrui Real Estate has extended all of its RMB 1.85 bn of outstanding bonds; cumulative losses over the past three years exceed RMB 9 bn, short-term debt accounts for as much as 82.8% of the total, and sales continue to slide, with 2024 contracted sales of just RMB 2.077 bn.

Tianfeng Securities signs for over 10,000 sqm of offices at Jinmao Center, North Bund, Shanghai

Tianfeng Securities recently signed for more than 10,000 sqm of office space in Tower T1 of Jinmao Center on Shanghai's North Bund, relocating from Building 6 of the Shanghai Port International Cruise Terminal at 678 East Daming Road, Hongkou. Less than a year into leasing, occupancy at Jinmao Center North Bund exceeds 70%, with quality tenants including the Shanghai Bar Association, Dajia Life Insurance Shanghai Branch, Beiming Software, Chuangkeji, Jinmao Shanghai, YTO International, Lewan Huanjing and Lüchuang Workshop, spanning law, finance, technology, TMT and shipping. Located at 919 East Changzhi Road, Hongkou (opposite Exit 4 of Tilanqiao Station), the project neighbours the 480 m Shanghai North Bund Center - Puxi's tallest tower - as well as Raffles City The Bund and AIA Financial Centre. Total GFA is c. 109,800 sqm, composed of the c. 58,600 sqm T1/T2 twin high-end 5A Grade A office towers, a retail podium and an underground retail street.

China Renaissance buys personal consumer NPL portfolios for RMB 308 m

On 31 December 2025, China Renaissance announced it had acquired two personal consumer non-performing loan portfolios from Qifu Technology for RMB 308 m, against combined outstanding principal of RMB 7.429 bn - a discount rate of just 4.15%, or roughly four cents on the dollar. The first portfolio, from Fuzhou Qifu Financing Guarantee, carries outstanding principal of RMB 6.677 bn with average delinquency of 854 days, of which 20% is 1-2 years overdue; the second, from Fuzhou Qifu Online Microlending, involves RMB 752 m of principal with average delinquency of 439 days, with nearly 40% overdue by 1-2 years - all unsecured personal loans. China Renaissance stated the move is intended to "expand the scope of proprietary investment and diversify revenue sources".

Listed company wins Jianguo Road West garden villa in Shanghai at auction for RMB 456 m

On 12 January, a garden villa of nearly 3,000 sqm at 319 Jianguo Road West in the Hengfu Historic Area, Xuhui District, Shanghai, sold at judicial auction at its reserve price of RMB 456 m; the winning bidder was a subsidiary of listed company Fangda Carbon New Material. The four-storey villa has GFA of 2,997.83 sqm plus a 1,000 sqm garden, implying a unit price of c. RMB 152,200/sqm. The land is zoned for office use, with tenure running to 27 January 2064.

China Index Academy: Shanghai housing market 2025 data report

New homes - transaction area: the share of sub-100 sqm entry-level products fell markedly, while 110-140 sqm entry-upgrade products gained clearly. In 2025, sub-100 sqm entry-level products accounted for 29.7% of transactions, down 8.9 pct pts YoY; 110-140 sqm entry-upgrade layouts reached 23.9%, up 8.8 pct pts YoY - the main pocket of incremental demand.
New homes - transaction price: the share of sub-RMB 8 m deals declined, RMB 8-20 m deals grew, and activity above RMB 20 m shifted markedly toward the ultra-luxury end. Sub-RMB 8 m homes made up 59.6% of the market - the mainstream segment - down 8.1 pct pts YoY; RMB 8-20 m homes accounted for 32.3%, the secondary mainstream band; RMB 20-50 m luxury deals fell c. 2.3% YoY; the share of RMB 50 m+ deals rose 1.1 pct pts YoY.
Secondary market: in December the volume-for-price pattern persisted with clear destocking - secondary home prices kept falling while volumes grew. For full-year 2025, 222,206 secondary homes traded, up 4.14% YoY; the December average contracted price was RMB 35,707/sqm, down 1.32% MoM and 17.43% YoY. Destocking was evident in December, with listed inventory of 279,375 units at end-December, down 7.92% MoM.