Desperate China Developers Take Crops as Down-Payment

 

Wheat and garlic are being accepted as property down-payments as desperate China developers scramble to boost sales after a nosedive in transactions in January to May.

One advertisement by Henan-based developer Central China that had “swap wheat for house” in the title says buyers can use the crop to offset as much as 160,000 yuan ($24,000) of the down-payment in one of its developments.

China’s strict Covid-19 curbs, combined with worries about a deeper property correction, have clouded Beijing’s 2022 economic growth target of 5.5%.

A Central China sales agent said the wheat promotion was aimed mainly at farmers in the region. It started on Monday and will end on July 10 for houses costing 600,000 to 900,000 yuan, the agent said.

Central China Real Estate, the developer’s sales unit, recorded a 71.3% plunge in sales in May from a year ago, while sales in the first five months dropped 48.6%.

Late last month, another Central China advertisement said buyers of houses in another development could make down-payments in garlic.

The promotion attracted 852 visits and 30 transactions involving about 500 tonnes of garlic during the 16 days it was available, the advertisement said.

The wholesale market price for both garlic and wheat is 3 yuan per kg.

More common promotions by China developers include free parking lots or renovations after purchase.

 

• Reuters, with additional editing by George Russell

 

 

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