China’s economy has looked stronger on some headline indicators in late 2025, but many people on the ground say the strain is still intensifying—especially for households and small businesses tied to the property market. The Associated Press reports that exports and technology-led growth have offered an optimistic backdrop, while weak housing prices and uncertainty over jobs and incomes have left other parts of daily life feeling subdued. The contrast, economists and residents say, points to a widening gap between official projections and consumer confidence.
In Beijing, billiards hall owner Xiao Feng described a business environment that, in his words, has become “very tough” as spending has tightened. “It seems the wealthy don’t have the time, and the ordinary folks don’t have money to spend,” he said, describing how costs—such as rent, labor and utilities—have left him “just breaking even.” The AP reported that Xiao and his wife, a nurse, have a 10-year-old son, and that his wife’s stable income has made her the household’s breadwinner. Xiao said he previously contributed about 100,000 yuan annually to the family, but he has cut staff from eight to five and has had “no income for about six consecutive months now.”
The AP also cited Beijing-based commercial property agent Zhang Xiaoze, who said his earnings have fallen sharply from peak years in the mid-2010s. Zhang told the AP that he used to make up to 3 million yuan a year, while now he brings in about 100,000 yuan annually. He described the business environment as “extremely challenging” and linked weakened demand to companies relocating out of Beijing, adding that “The fundamental issue is that people don’t have money.”
While residents described tightening budgets, the Chinese government’s policy direction has leaned toward “high-quality growth” and domestic innovation, with investment and support flowing to technology sectors, the AP reported. The story said the Communist Party is promoting leader Xi Jinping’s push for advances including artificial intelligence and electric vehicles, even as it works toward a consumption-driven model. In parallel, exports are still described as a key driver of jobs and growth as China transitions away from the earlier decades’ property- and infrastructure-heavy development approach.
The AP said that in the first 11 months of 2025, China’s exports totaled a record $3.4 trillion, with shipments to Southeast Asia and Europe helping offset a sharp drop to the U.S. It also cited economist Lynn Song, chief economist for Greater China at ING, who described the country’s shift as a “Great Transition” away from the prior growth engines that drove the past three decades. Song said the AI boom has helped push up share prices, but she argued that most people have not seen a direct wealth effect—pointing to why “many feel the situation on the ground is not reflecting the relatively more optimistic growth picture.”
Other economists highlighted a mismatch between official growth data and their reading of household and business conditions. Zichun Huang, China economist at Capital Economics, told the AP that the divergence between official figures and what many Chinese people feel suggests China’s actual growth “may be well below” what official data indicate. The AP also reported that retail sales growth slowed to 1.3% in November from a year earlier, compared with 2.9% growth in October, and that fixed-asset investment dropped 2.6% in the first 11 months of 2025. HSBC analysts also said disposable household income growth has been running below the pre-pandemic pace in recent years and that “income gains from property have virtually vanished.”
Much of that uncertainty traces back to property’s role as the main repository for household wealth, the AP reported. It said housing prices have fallen 20% or more since peaking in 2021 after a crackdown on excessive borrowing that contributed to a debt crisis in the real estate sector. The AP reported that new home sales fell 11.2% by value in the first 11 months of 2025, and that property investments fell nearly 16% year-on-year. For some people, the economic stress also showed up in decisions about consumption, education spending and long-term purchases.
The AP described Xiao Feng’s own experience with property depreciation: he bought an apartment in Beijing’s Tongzhou district in 2019 for more than 3 million yuan, and he said it is now worth about $342,000. He told the AP that he drives a 10-year-old car and has “no plans to replace it,” saying his uncertainty about the economic outlook has affected plans including tutoring costs for his child. Xiao said he previously spent a “considerable amount” on tutoring but that the family has cut that entirely and teaches their son themselves. A tutor in Tianjin who identified himself only as Zhou, said his income fell by more than a third as more parents stopped sending their children for tutoring, adding, “Because of the economic situation, parents are unwilling to spend money on tutoring.”
Looking forward, the AP reported that most forecasts for 2026 call for slower growth, arguing that China’s leaders are relying on incremental policies while delaying reforms that could boost consumer confidence—especially while housing remains weak. It described broader economic pressures such as excess supply in industries including autos, steel and consumer goods, as well as falling export prices. It also cited economists who argue that a fundamental shift would be needed to let workers hold a much larger share of national wealth, which they said appears politically hard to pursue.
In the northern city of Shijiazhuang, the AP reported that a budget hotel owner described dim prospects for a near-term rebound. The man, who gave only his surname Zhai, told the AP: “I don’t see an immediate rebound in the economy.” He said his lease expires next May or June and that if conditions do not improve by then, he will shut down the hotel. The AP reported that he declined to make additional comments about the economy, saying he feared getting in trouble, while noting he had a limited education and that “switching industries is almost impossible.”