In China, millions of empty and unwanted newly built homes are causing a housing crisis. With nearly 391 million square meters of unsold residential property, equivalent to the size of Manchester and Birmingham combined, the government is facing challenges in balancing the property market. The real estate sector, traditionally a key player in the country’s economy, has been struggling since 2020 due to the pandemic and regulatory issues.
Various tactics like subsidies and tax refunds have been implemented to stimulate the market, but sales remain low. Property developers are struggling with unsold stock and bankruptcy looms. The government intervened by offering a 300 billion yuan relending fund to convert unsold properties into affordable housing.
Despite this stimulus, experts believe it’s not enough to revive the market. Local governments, already burdened with debt, are hesitant to invest in initiatives with uncertain profitability. The housing market remains stagnant, with limited demand for the excess supply of homes.
As the government focuses on discouraging speculation and promoting residential living, the challenge of revitalizing the property market persists. With limited options and a cooling market, the future of China’s real estate sector remains uncertain.