(Bloomberg) -- The worst of China’s record housing slump is finally over, according to the country’s second-largest developer. 

“In the short term, the market has bottomed out, but the recovery is a slow and gentle process and will take time,” China Vanke Co. Chairman Yu Liang said at the company’s annual general meeting Tuesday, according to a transcript posted on its WeChat account. 

Yu cited a mild sales increase in May from April in first- and second-tier cities, adding that the recovery may become more distinct in June. That would be welcome news for developers, which are counting on a sales rebound to ease a crippling cash crunch that triggered a wave of defaults. 

A Bloomberg Intelligence gauge of developer stocks climbed as much as 2.7% to the highest in a month after Yu’s comments. 

Signs of improvement in the housing market have emerged after local governments eased some buying curbs and authorities cut mortgage rates. New-home sales in 17 cities monitored by China Index Holdings surged 89% so far in June from a month earlier, also helped by a loosening of Covid restrictions.

Still, Yu doesn’t foresee a return to the boom years. “The industry has entered a new stage of development,” he said. 

China’s housing sales have fallen year-on-year for 11 months straight, a record since the nation’s private property market began in the 1990s. Inventories remain elevated and there’s no sign of growth in new construction, Bloomberg analysis shows.

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