For the first time in the history of central finance, mortgage interest subsidies have been granted, indicating that the real estate market has reached a point where it cannot be saved ⚡ ️ On September 29th, the Ministry of Finance, the People's Bank of China, and the State Administration for Financial Regulation jointly issued a document stating that starting from October 1st, commercial personal housing loans for eligible first-time homebuyers will receive an annualized 1 percentage point financial subsidy. The maximum term is 5 years, and the maximum limit for a single subsidized loan is 1 million yuan. The subsidy funds are 90% borne by the central government and 10% borne by local governments. According to the current level of interest rates for first-time home loans, this is equivalent to a one-third discount on the interest rate. A loan of 1 million yuan can reduce interest payments by nearly 50000 yuan cumulatively. The conditions are very clear: first home, new house or second-hand house are all acceptable, with a building area not exceeding 120 square meters and a total house price not exceeding 1.5 million yuan. This is the first time in the history of central finance that the central government has subsidized housing loans, which is unprecedented ❗ ️ On the surface, it is a good news for homebuyers, but the signal significance of the policy lies not in the interest subsidy itself. This matter may be much more severe than we imagine! Let's take a look at a few sets of data. Firstly, the new house cannot be sold. According to data from the National Bureau of Statistics, from January to August 2026, the sales area of newly-built commercial housing in China decreased by 12.1% year-on-year, with residential sales area decreasing by 13.0%. The monthly decline in August is still expanding. According to data from the Zhongzhi Research Institute, the transaction area of newly-built commercial residential properties in key 100 cities in the first three quarters decreased by about 10% year-on-year. Secondly, the largest market is shrinking. The first tier city "Golden Nine" is still acceptable, but the second tier representative cities have decreased by 34.7% year-on-year, and the third tier representative cities have decreased by 45.1% year-on-year. It is precisely in third - and fourth tier cities where real estate inventory pressure is highest and the demand for urbanization among new citizens is most concentrated that this round of interest subsidy policies targets the main battlefield of "below 1.5 million". According to a research report by Caixin Securities, the turnover cycle of new houses in third - and fourth tier cities is as high as 63 months. Thirdly, the confidence in buying a house has collapsed. According to the July 2026 survey report on residents' willingness to purchase property by the China Index Research Institute, the proportion of those who plan to buy a house within one year has dropped to 50%. The proportion of expectations for a decline in housing prices has remained stable at a high of 32%, while expectations for an increase have dropped to 9%, with more than three times the number of bearish sentiment compared to bullish sentiment. Fourthly, it's not that they don't want to buy a house, they're afraid to spend money. Residents' willingness to save has rebounded to 56%, while their willingness to invest is only 20%. Money lying in the bank doesn't enter the real estate market. This indicates that the current transaction volume of China's real estate has dried up and is in jeopardy, and the central finance department must intervene to rescue the real estate industry. The first time the central government directly intervened in the real estate market was not because housing prices had fallen sharply, but because transaction volume had dropped to a point where direct intervention with fiscal tools was necessary. The housing price hasn't dropped at all, it's just that the government has paid a portion of the interest for you, allowing those who are still watching to withdraw their money from the bank. This is not about housing prices, it's about transaction volume. This is not a bottoming out of housing prices, it's a bottoming out of transaction volume first. Ultimately, what the central finance department wants to save is not housing prices, but the liquidity of the real estate market. The urgency and severity of this matter may exceed most people's understanding. Central intervention is never a small matter. This time, I choose to believe.