According to new estimates by S&P Global Ratings, real estate sales in China may fall by 30% this year. This is due to the fact that there are more and more citizens who refuse to pay their mortgages.
Esther Liu, director of S&P Global Ratings, said that the market is now in a more acute crisis than in 2008. Then sales fell by 20%.
Since the end of June, unofficial calculations show that more and more Chinese citizens refuse to pay mortgage loans until the developer hands over the object. Currently, there are hundreds of unfinished houses on the Chinese housing market. In China, it is a very common practice when people take out a mortgage to buy a home that is still under construction. These funds give the developer the opportunity to work on the object. However, in 2022, due to new knockdowns related to COVID-19, many construction companies did not have time to complete the facilities on time. The authorities called on the management of banks to support developers.