China Property Market Faces Challenges as Home Buying Scheme Struggles

Wednesday, 21 August 2024, 23:30

China's property market is witnessing disappointing progress as the US$42 billion home buying scheme falters. Analysts report that sluggish implementation is hindering local governments' efforts to buy unsold homes, crucial for developers. As economic conditions remain bleak, more robust measures are necessary to restore confidence.
South China Morning Post
China Property Market Faces Challenges as Home Buying Scheme Struggles

China's Property Market and the Slow Home Buying Scheme

The property market in China is encountering significant hurdles due to the disappointing speed of a government-initiated scheme meant to buy up unsold homes. Analysts express concerns that the 300 billion yuan (approximately US$42 billion) plan is not being effectively executed, posing challenges to developers within the housing framework.

Current Status of the Scheme

  • Only five cities have made significant purchases despite local governments announcing their support following Beijing's relending facility.
  • As of now, home buyers have shown diminishing confidence due to the slow implementation of this crucial policy.

Plans and Projections Moving Forward

While around 30 cities in China are outlining requirements for buying unsold homes, challenges persist regarding size, ownership, and price limits.

  1. Major cities like Shenzhen join the initiative, with a few more contemplating similar actions.
  2. Estimations suggest that 71.6 million square meters of homes could be affected, merely 18.7 percent of existing unsold inventory.
  3. Increased funding requirements present another hurdle for sustainable implementation.

As local governments consider issuing special bonds to boost home purchases, observers are keenly awaiting bolder, decisive actions to rejuvenate the property sector.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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