Real Estate

China Moves to Boost Affordable Housing, Home Loans Amid Crisis


Chinese officials made multiple moves on Friday to boost home-buying in the country, amid a deepening property crisis that threatens to derail an already faltering economy.

China’s cabinet on Friday approved guidelines for planning and construction of affordable housing at a meeting chaired by Premier Li Qiang, state media Xinhua news agency reported.

Separately, China’s central bank announced guidance on relaxing residential housing loan rules, in a move aimed at boosting loan applications and house purchases.


Also on AF: Unpaid Workers, Halted Projects Add to Country Garden’s Woes


Xinhua didn’t give details of the new cabinet guidelines for affordable housing. But it cited the cabinet as saying they would expand investment and promote the healthy development of the property market.

The People’s Bank of China, meanwhile, said that banks should treat those without a house in their names at the location of a purchase as first-time home buyers, regardless of whether they have previously used a loan for a home purchase.

The central bank also said it would stick to the principle that houses are for living in and not vehicles for speculation.

On Friday, the housing ministry, the central bank and the national financial regulator also jointly issued a notice easing mortgage policies to help revive the realty sector.

The moves come amid rising calls for greater state intervention as the Chinese property sector deals with an increasing risk of default among some developers struggling to sell apartments and raise funds.

The real estate sector accounts for roughly a quarter of the world’s second-largest economy and is estimated to be saddled with more than 50 million unsold or empty apartments.


Affordable housing push

Beijing has been promoting more affordable housing in recent years as runaway home prices in major cities shut out many young buyers.

The plan has assumed greater significance in the wake of the debt crisis in the property sector and weakening economic growth.


Also on AF: China’s $13tn Provincial Debt Crisis Threatens to Spill Over


An official at the Ministry of Housing and Urban-Rural Development said last year that China would add 6.5 million new low-cost rental housing units in 40 major cities in 2021-2025.

However, with the property downturn, official data showed new home prices fell in July for the first time this year, underlining an urgency for bolder policy support.

China’s housing market has over the past two years been grappling with a severe debt crisis – initially triggered by government moves to rein in ballooning debt.


Hong Kong property agency owed millions in commissions

Meanwhile, one of Hong Kong’s largest property agencies Centaline Property said on Friday its mainland China unit was owed a huge amount of unpaid commissions.

Responding to reports of delayed payments to the unit by developers including the embattled Evergrande, Centaline said “the current amount of unpaid commissions from developers and agents is huge.”

The agency did not give a figure for the unpaid commissions but state-owned Securities Times reported on Monday that the mainland unit was owed more than 1 billion yuan ($137.19 million) in commissions.

Centaline said that all of units were operating normally and it would not withdraw from the mainland China market. It added, however, the company was operating under major pressure.


  • Reuters, with additional editing by Vishakha Saxena


Also read:

The Pledge That Brought Country Garden to the Brink of Default

China Evergrande Files Claim in US Court to Protect Its Assets

Struggling Chinese Asset Manager Zhongzhi Looking at Debt Rejig

Trust Fund Woes and Home Price Falls Add to China’s Problems

China’s Dalian Wanda May be Next Property Giant to Fall

Foreign Investors ‘Won’t Return Till China Starts Spending Again’



Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has been working as a digital journalist since 2013, and is an experienced writer and multimedia producer. As a stock market trader and investor, she is keenly interested in economy, emerging markets and the intersections of finance and society. You can tweet to her @saxenavishakha

Recent Posts

Nvidia in Chip Design Tie-Up Talks With Vietnamese Tech, Hanoi

The Southeast Asian nation is looking to move beyond manufacturing and assembly amid trade tensions…

10 hours ago

US, S Korea, Japan Team Up to Confront N Korea Cyber Threat

The allies say Pyongyang uses cybercrime profits to gather funds for its nuclear and missile…

11 hours ago

China Consumer Prices Fall Fastest in 3 Years, Alarming Beijing

Persistently sluggish demand has raised the spectre of wide-scale deflation amid mounting local government debt…

12 hours ago

China Developer Shimao’s Shares Slide on Debt Revamp Plan

The property firm is hoping to decrease its debt by about $6 billion to $7…

1 day ago

Chinese Investment in Vietnam Doubles, As US Trade Eases

The manufacturing hub by the South China Sea is increasingly a key assembling link in…

1 day ago

Apple Shifts Key iPad Design Resources to Vietnam – Nikkei

Geopolitical tensions are thought to be behind the move which will see Vietnamese contractors involved…

1 day ago