"Urban Renewal" Incorporated into Overall Guidelines — Key Signals from the Central Urban Work Conference Convened After a Decade

From July 14 to 15, the Central Urban Work Conference was held in Beijing. As the highest-level conference on urban affairs, its reconvening after ten years marks a clear signal for the future direction of urban development in China.

According to CCTV News, the conference introduced five “transitions” and five “greater emphases.” Experts noted that, compared to the five “coordinations” proposed at the 2015 conference, these new terms reflect a profound shift and continued refinement in China’s urban development philosophy. The emphasis indicates a full transition of urban work toward an intensive, high-quality development stage.

Regarding the real estate market, Wang Yeqiang, Deputy Director and Researcher at the National Future City Laboratory of the Chinese Academy of Social Sciences, stated in an interview with The Paper that the meeting signals the industry’s transition to a new phase marked by “improvement of existing stock, dual-track supply, and cultural preservation.” The core of this policy lies in stimulating domestic demand through urban renewal and driving supply-side upgrades via the development of quality housing, rather than replicating previous monetized shantytown redevelopment models.

This was the fifth session of such a high-level urban work meeting, following those held in 1962, 1963, 1978, and 2015. In December 2015, the fourth national urban work conference was convened for the first time under the Central designation, formally elevating urban work to the national level.

This year’s conference emphasized that urban work must achieve five “transitions” in both philosophy and practice, accompanied by five “greater emphases.” Urban development should adapt to changing conditions, shifting its concept toward a people-oriented approach; its methods toward intensive and efficient development; its driving forces toward specialized growth; its focus toward governance capacity; and its practices toward coordination.

Industry professionals observed that the reconvening of the conference after a decade reflects that urban development has entered a new phase, characterized by new challenges. The conference noted that China’s urbanization is transitioning from a period of rapid growth to one of steady development, with the focus of urban expansion shifting from large-scale incremental growth to improving the quality and efficiency of existing stock.

According to a report by China Index Academy, the number of cities in China has reached 694 after ten years of development. In 2024, 27 cities reported GDP exceeding RMB 1 trillion. The urbanization rate rose from 57.3% in 2015 to 67%, with an annual average increase of 1.1 percentage points. However, between 2021 and 2024, the annual increase dropped below 1 percentage point, indicating a deceleration in the urbanization process. The urban population also rose from 790 million in 2015 to 940 million, with over 16 million added annually, though the average annual increase from 2021 to 2024 fell to 10.33 million.

Wang Yeqiang emphasized that the traditional high-investment, high-consumption urbanization model has become unsustainable. Growing resource and environmental constraints necessitate a transformation in development methods. Urbanization is moving from a focus on speed and scale to one on quality and efficiency, entering a new phase where both dimensions are balanced. The current stock-focused stage requires a complete restructuring of the logic of urban development, aligning goals with human-centric values, incorporating digital governance, and activating diverse mechanisms for co-creation. The core of future urban work lies in constructing a triad of quality renewal, resilient governance, and inclusive services to turn cities into true carriers of a better life for the people.

According to a report by CRIC, although urbanization is stabilizing, the process of integrating agricultural migrants into urban life will continue. The gap between the urbanization rates of the resident and registered populations remains substantial and needs to be bridged. The rigid housing demand brought by migrant urbanization remains a fundamental driver of the real estate sector.

This conference explicitly incorporated “urban renewal” into the overall policy requirement, emphasizing that “high-quality urban development” should be the central theme, “intensive development” the main focus, and “urban renewal” the key approach. The objective is to establish a new path for urban modernization with Chinese characteristics.

Chen Wenjing, Director of Policy Research at China Index Academy, pointed out that the inclusion of urban renewal in the general requirements reflects its rising importance in urban development. The call for “high-quality urban renewal” suggests that China’s urban development has entered a new stage focused on renewal.

Zhang Bo, Director of 58 Anjuke Research Institute, explained that emphasizing urban renewal improves supply by redeveloping underutilized land and enhancing spatial efficiency. It also stimulates housing demand through relocation policies, including monetized resettlement.

Wang Yeqiang stated that innovative approaches to urban renewal integrate retaining, renovating, and demolishing. Functional replacements, such as converting old factories into science and innovation parks, help activate inefficient spaces. After achieving significant results in the initial 15 pilot cities, the central government will allocate RMB 20 billion in 2025 to support 20 model cities, with a focus on six key areas including underground infrastructure. To support these long-cycle projects, the central government will also explore mechanisms such as REITs financing and tax-sharing. The renewal process must adhere to the principle of “preservation first,” ensuring full protection of cultural heritage and prohibiting the demolition of historic districts under the pretext of unsafe housing.

On May 15, the General Office of the CPC Central Committee and the General Office of the State Council jointly issued the “Opinions on Continuing to Advance Urban Renewal,” followed by press briefings from several ministries outlining supportive policy measures. These include diversified and tailored financial products, specialized loan management mechanisms for urban renewal, and increased central government investment.

The conference also emphasized the need to accelerate the formation of a new model for real estate development. Industry experts believe this continues the core direction of real estate regulation, with an increased focus on reforming both supply and demand mechanisms.

Chen Wenjing observed that, after years of development, the average urban per capita housing area in China exceeds 40 square meters, with households averaging over one unit. Basic housing needs have largely been met, and consumer preferences have shifted from “availability” to “quality.” In recent years, the central government has repeatedly called for the development of a new real estate model, and many local governments have already begun exploring localized approaches, with some initiatives taking effect this year.

From an industry standpoint, the new model includes improvements to the market and affordable housing supply systems, reform of foundational real estate institutions, the establishment of mechanisms linking housing, land, finance, and population, construction of high-quality housing, and the formation of coordinated regulatory systems. These supporting policies are expected to be further refined and implemented in the coming years.

Unlike the 2015 conference, which emphasized speeding up shantytown redevelopment, the current meeting focused on “steady progress in urban village and dilapidated housing redevelopment,” aiming to build livable and convenient urban environments.

Guotai Haitong Securities’ macro research team noted that the current emphasis on urban renewal avoids large-scale demolition and construction. Instead, it focuses more on improvements to building standards, public utilities, and green spaces, similar to the post-2016 policy direction.

Industry professionals have observed that, since the beginning of this year, various regions have expanded housing voucher policies to stimulate housing demand, achieving positive results in some cities. As urban village and dilapidated housing redevelopment advances, the related resettlement mechanisms may continue to improve, potentially playing a more significant role in stabilizing the real estate market.

The conference also called for strengthening the safety of urban infrastructure systems and accelerating the renovation of outdated pipelines. It emphasized strict restrictions on the construction of super high-rise buildings and overall improvements in building safety.

“Building green, low-carbon, and beautiful cities” was listed as a key task. High-quality, green housing is positioned as a core component of improving urban development. Zhang Bo believes that constructing “safe, comfortable, green, and smart” homes is the direction for high-quality real estate development. The industry is shifting from scale expansion to quality competition. New buildings will follow green building standards. Leading developers are accelerating their adoption of green technology, and fourth-generation buildings will continue to emerge in more cities. Additionally, reforms to the commercial housing sales system and the gradual adoption of completed-housing sales with improved regulation of pre-sale funds aim to reduce delivery risks and improve housing quality.

Wang Yeqiang stated that in the era of urban renewal, real estate development should follow three key directions. First, development should shift from volume-driven growth to operations-oriented capabilities, with developers transforming from builders into “space operators” and moving away from the traditional “high turnover–high debt” model. Second, the focus should move from single residential development to scenario-based design, requiring integration of industries and consumer environments. Third, government-led initiatives should transition toward multi-stakeholder participation, exploring funding mechanisms involving residents, REITs, and tax-sharing to reduce the reliance on government support. Fourth, standardized replication should give way to localized innovation. In historical preservation zones, “one building, one plan” models force developers to abandon uniform product strategies.

The conference also reaffirmed the continued importance of urban agglomerations and metropolitan area development. In 2015, the emphasis was on treating urban agglomerations as the primary spatial form and promoting compact, efficient, and green development.

Chen Wenjing highlighted that the Beijing-Tianjin-Hebei region, Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area have played pivotal roles in population concentration, industrial upgrading, and economic growth. The Chengdu-Chongqing and middle Yangtze urban agglomerations have also seen rapid development and emerging regional advantages. In 2024, China’s five major urban clusters accounted for roughly one-tenth of the country’s land area, over 40% of the population, and more than 50% of GDP. The eight largest clusters housed over 60% of the population and contributed more than 70% of GDP, underscoring their strategic importance in national development.

The conference proposed strengthening cities’ capacity to support population and socioeconomic development by promoting modular and networked development of modern urban clusters and metropolitan areas. It also called for differentiated urbanization centered on county-level cities, the continued urban integration of rural migrants, coordinated development of large, medium, and small cities, and rural-urban integration.

CRIC reported that population drives real estate demand, and population follows employment opportunities. Future demand growth in the real estate sector will be closely aligned with urban clusters and metropolitan areas, particularly core cities. Among 386 county-level cities, 208 have urbanization rates below 60%, accounting for over half. Among 1,496 county-level administrative areas, 1,356 have rates below 60%, exceeding 90%. Compared to municipal districts, these counties offer broader development potential. The large base of permanent residents and rapid urbanization will translate into substantial new rigid housing demand.