Shanghai's property market has recently bucked the traditional off-season trend with both transaction volumes and prices on the rise, and the new policy is set to further solidify this positive momentum.
On August 20, six departments including the Shanghai Housing and Urban-Rural Development Commission and the Shanghai Housing Authority jointly issued the "Notice on Optimizing Local Real Estate Policy Measures" (hereinafter referred to as the "Notice"), which will officially take effect on August 21, 2026. The Notice introduces a comprehensive package of eight measures across five key areas—housing provident funds, credit policies, home purchase subsidies, house ticket resettlement, and acquisition of existing housing stock—aimed at reducing the costs for residents to purchase and trade up homes.
In terms of provident fund policy, the new measures clarify an expansion of the scope for using provident fund withdrawals to cover down payments. Building on the August 2025 "Six Shanghai Measures" that allowed contributors to withdraw provident funds for down payments on newly built pre-sold commodity housing, the new policy adds support for down payments on newly built completed properties. Importantly, such withdrawals will not affect the calculation of provident fund loan limits. Additionally, the frequency and caps for purchase-related withdrawals are being optimized. For buyers in Shanghai who have no outstanding provident fund mortgage and have not enrolled in the offset repayment service, the purchase withdrawal, previously a one-time event, can now be made annually for five years from the issuance date of the property ownership certificate, with the withdrawal cap raised to the full amount of self-funded payment actually made for the property.
Regarding the optimization of personal housing credit policies, the Notice specifies that for purchases of second homes outside the outer ring road (including areas previously under differentiated policies), the minimum down payment ratio for commercial loans will be reduced from no less than 20% to no less than 15%. After this adjustment, the minimum down payment for first homes across the city is uniformly set at 15%. For second homes, the regional differentiated policy remains: the minimum down payment inside the outer ring road is no less than 25%, while outside the outer ring road it is no less than 15% (including the entire districts of Baoshan and Jiading).
Furthermore, Shanghai will allocate a total of 200 million yuan to implement a phased subsidy policy for the "trade-in" home purchase scheme. From August 21, 2026, to March 31, 2027, resident families who purchase a new home outside the outer ring road and complete online filing, while also selling a second-hand home inside the outer ring road within one year before or after the filing date, can apply to the real estate transaction center in the district where the new home is located for a subsidy of 30,000 yuan. Alternatively, families purchasing a new home outside the outer ring road and selling a second-hand home within one year of the filing date can apply for a subsidy equivalent to 1% of the total new home loan amount, with a maximum subsidy of 50,000 yuan per unit. The total subsidy pool is capped at 200 million yuan and will be distributed on a first-come, first-served basis until exhausted.
The Notice also proposes strengthening the implementation of house ticket resettlement by adding this option to the compensation and resettlement process for expropriation and demolition. This will focus on projects such as urban village redevelopment and old city renovation, offering diversified resettlement paths to meet the varied needs of residents. Concurrently, Shanghai will accelerate the acquisition of second-hand homes to convert them into government-subsidized rental housing. In line with the "15th Five-Year Plan" deployment for subsidized rental housing, all central urban districts (including areas within the outer ring road in Pudong) will advance the acquisition of second-hand housing and speed up renovation and leasing efforts to effectively increase the supply of subsidized rental housing in the central city.
Lu Wenxi, a market analyst at Shanghai Zhongyuan Real Estate, noted that since the beginning of this year, housing demand in Shanghai has been continuously released, with the market showing a sound trend of rising both volume and price. The land market has also heated up in tandem, with multiple plots setting new regional price records, reflecting developers' firm confidence in the market's stable and positive outlook. With the overall improving trend already established, the timely introduction of the "Eight Shanghai Measures" can precisely target improvement-oriented demand and further consolidate the market's upward trajectory.
Since July, Shanghai's property market has exhibited a "busy off-season" with both volume and prices climbing. According to Zhongyuan Real Estate data, the city's new home market saw transaction volumes in July increase slightly by 1% year-on-year, marking the first positive turnaround this year. Mid-to-high-end products have remained active in trading, continuing the momentum seen since last year. Recently, several first-time improvement projects priced around 60,000 yuan per square meter outside the outer ring road have triggered the "points system," indicating that improvement demand is being steadily released. National Bureau of Statistics housing price indices also show that Shanghai's home price growth leads the nation on a year-on-year basis.
The second-hand housing market has performed even more robustly. Apart from February, which was affected by the Spring Festival, transaction volumes have remained above 20,000 units per month for all other months this year, sustaining a high level of activity. National Bureau of Statistics data reveals that Shanghai's second-hand housing price index has rebounded for six consecutive months, with a cumulative increase of 2.2%, signaling a substantial shift in the market's operational trend.
Lu Wenxi believes that the "Eight Shanghai Measures" further broaden the scope of provident fund usage, flexibly leveraging this tool to support the diverse housing needs of contributors and effectively easing the burden on homebuyers. Regarding credit policy, the down payment ratio for second homes inside the outer ring road is set at no less than 25%, while outside the outer ring road it is no less than 15%. The credit policy for second homes outside the outer ring road is now essentially aligned with that for first homes, and this differentiated arrangement precisely matches market demand, helping to invigorate transaction activity outside the outer ring road.