Fact Check: China's demographic demand for new urban housing likely halved within a decade.

Fact Check: "China's demographic demand for new urban housing likely halved within a decade."

What We Know

Recent analyses indicate a significant decline in China's demand for new urban housing, largely attributed to demographic shifts. According to a report by Goldman Sachs, annual demographic demand for new homes in urban China is expected to fall to an average of 4.1 million units per year from 9.4 million units in the 2010s, effectively halving within the next decade (source-1, source-3). This decline is attributed to a shrinking population, stagnant incomes, and a surplus of unsold homes (source-2).

The World Bank projects that China's population will decrease from 1.41 billion to below 1.39 billion by 2035, driven by declining birth rates and an aging population (source-2). Furthermore, the fertility rate has continued to drop despite government incentives to encourage childbirth, indicating that demographic demand for housing is likely to remain low (source-2).

Analysis

The claim that China's demographic demand for new urban housing has likely halved within a decade is supported by multiple credible sources. Goldman Sachs, a reputable investment bank, has provided a detailed forecast that aligns with the observed trends in population decline and housing demand. Their analysis suggests that the annual demand for new homes will remain suppressed at below 5 million units per year, which is a stark contrast to the peak demand of 20 million units in 2017 (source-1, source-3).

Additionally, other reports corroborate Goldman Sachs' findings, emphasizing that the demographic shift is exacerbated by economic factors such as stagnant incomes and a poor social security system, which discourage young people from starting families (source-2). The closure of thousands of kindergartens and a significant drop in preschool enrollment further illustrate the declining birth rates (source-2).

While some analysts, such as William Wu from Daiwa Capital Markets, suggest that the demographic decline may not have an immediate impact and could take decades to fully manifest, the overall consensus remains that the trend is clear and significant (source-2).

Conclusion

Verdict: True
The claim that "China's demographic demand for new urban housing likely halved within a decade" is substantiated by credible forecasts and analyses from reputable sources, including Goldman Sachs. The evidence indicates a marked decline in housing demand due to demographic shifts, particularly a shrinking population and declining birth rates, which are expected to continue impacting the housing market significantly over the next decade.

Fact Check: China's demographic demand for new urban housing likely halved within a decade.