China’s Once-Sizzling Property Market Has Started to Cool

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China’s property sector started to crumble under the weight of its huge debts. What was already shaping up to be the country’s worst housing market in years suffered another blow when a new variant of the coronavirus triggered widespread lockdowns and brought the economy to a standstill, the New York Times reported. The turmoil has touched off a plunge in new home sales and depressed real estate prices for the first time in years, jeopardizing the prospects of an already fragile economy that had come to depend on housing for job growth and business spending, and putting at risk an important investment for millions of Chinese families. So far, China’s efforts to revive the housing market with lower mortgage rates, easier credit, subsidies and relaxed regulations have not worked. In April and May, new home prices fell in more than half of China’s 70 biggest cities for the first time since 2016, and sales of such properties tumbled nearly 60 percent. Zhanjiang, a port city of seven million people, had some of the steepest price declines among major cities. Mr. Liang said that he sold only five apartments in April. May was even worse. “Prices have come down, but enthusiasm for buying houses still hasn’t returned,” Mr. Liang said. “The economy is not good, and the continuous impact of the pandemic has completely changed the situation.” As China slowly emerges from restrictive lockdowns, the country is focused on preventing an economic slowdown. Last month, its premier, Li Keqiang, called an emergency meeting and issued a grave warning to more than 100,000 officials that businesses and local governments needed to act with “clear urgency.” Read more.
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