2023-09-16 14:00:02
Investors in China It seems that they are beginning to see greater credit risk in the real estate sector crisis in the country. According to data from Bank of Americathe number of respondents concerned about the sector has doubled to 33% in September compared to data from the previous month.
The Chinese promoter Evergrande, which announced its bankruptcy in the United States in August, has been fighting financial crises for two decades. However, the crisis de Country Garden, less given to these problems, is a good example of the fear that the Chinese real estate sector maintains.
Now, with the economy slowing and home prices falling, homeowners are not investing in second or third homes. Besides, Country Garden It has several unfinished projects in smaller cities where investors are purchasing even fewer homes.
Meanwhile, the authorities launched several measures a month ago to support the real estate sector, which generated a certain resurgence in activity. Despite this, in Beijing, which showed a greater reaction to the government stimulus, sales of homes already built decreased by 35% compared to what was recorded the weekend following the announcement of the relaxation measures in mortgage interests. Thus, the new construction homes have shown a similar trend in the capital.
The fall in salaries makes the situation difficult
The fall in the population’s salaries does not seem to be helping, with decreases that in Shanghai reach 9% and in Beijing 6% in the second quarter of the year compared to what was recorded in 2022. Likewise, the decreases in salaries seem to go hand in hand with a decrease in the benefits provided to employees. Even state jobs, which employ a large majority of the Chinese middle class, are not immune to these declines.
The sector of technology companies It is also suffering the consequences of the slowdown in the economy, along with the financial or banking industry, which has recorded cuts of up to 40%. Faced with these not very optimistic data, the government foresees growth in the economy of the 5% for 2023.
Added to this is a rate of youth unemployment which exceeded 20% at the time China decided to stop publishing data on the matter a month ago. The crisis has generated a slowdown in employment that has only worsened these data, which imply less investment in goods and services by the population. These forecasts would curb the ambitions of the country’s president, Xi Jinping, that this sector will be the main one in the Chinese economic recovery.
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