In mid-2023 a promotion in Hangzhou captured a paradox of China's housing downturn: buyers who purchased a 119-square-metre flat at a project in Lin'an received 1,000 grams of gold as part of a sales incentive. The apartment's market value has since fallen by roughly RMB 870,000, while the gifted gold — propelled by a sustained rise in bullion prices — is now worth about RMB 1.12 million, leaving the holder with an unexpected net gain.
That coincidence is not unique. Developers from Guangdong to Guangzhou and Shenzhen have deployed gold giveaways — sometimes convertible to cash or usable as a price offset — alongside more mundane incentives such as appliances or shopping cards. In one high-end Nanshan project in Shenzhen, marketing materials once promised up to 1,388 grams of gold; at issuance that bounty was worth roughly RMB 800,000, and today it is worth about RMB 1.56 million as international prices climbed.
The tactic works because the gifts do not primarily signal a preference for bullion; they signal a quantifiable, acceptable discount. Luo Wei, who ran marketing for the Shenzhen project during a market lull, says the gift served as a ‘‘price-discount symbol’’ that made the effective cost align with buyer expectations. In practice most purchasers did not take physical gold but accepted the cash equivalent at signing, underscoring that the promotional power came from perceived value rather than the metal itself.
Why do developers rely on gadgets, cards or gold rather than simply cutting prices? Legal and managerial constraints help explain the trend. Developers must follow record-filing rules for new-home prices and are sensitive to existing owners’ expectations; a direct price cut can be administratively difficult and reputationally fraught. In that environment, in-kind perks become a flexible method to achieve the same commercial objective: bridge the gap between asking price and psychologically acceptable buying levels.
The recent spike in gold has produced striking headline arithmetic: in projects that offered bullion, holders who accepted cash equivalents have seen an unexpected windfall relative to the properties’ capital values. Analysts in the industry mostly view this as an accidental hedge rather than a deliberate risk-management strategy by buyers. At the time of purchase, few would have anticipated using a promotional gift to offset a house-price correction; most simply took the promoted concession as an immediate discount.
That accident cuts both ways. Gifting gold only works as a marketing prop while bullion maintains value; if gold prices reverse, developers and buyers could face awkward optics and mismatched expectations. Furthermore, the success of these promotions depends on a narrow behavioral insight: buyers need to perceive the offered asset as liquid, stable and easy to value. Gold has long satisfied those requirements, which is why it became a visible instrument in promotional toolkits.
For policymakers and market-watchers the episode is revealing. It highlights the limited levers developers have to stimulate demand in the face of weak prices and regulatory limits, and it exposes how creative sales tactics can amplify asset-class volatility across markets. Gifted gold made for good headlines this year, but it does not alter the underlying dynamics of oversupply, high leverage and cautious buyers that define much of China's property cycle.
As marketing advisers retool strategies, the once-popular ‘‘buy-and-receive’’ gimmick is losing sheen: with gold at elevated levels, developers must weigh the risk that bullion falls or that buyers demand cash rather than in-kind concessions. For buyers, the lesson is practical: promotions can change the arithmetic of a deal in surprising ways, but they are not a substitute for careful assessment of a home's long-term value and the broader trajectory of local prices.