Whitelist expanded to 4 trillion yuan and 1 million homes renovated
In order to revive the stagnant real estate market, the Chinese government decided to increase the supply of loans from whitelist (prime real estate selected by the government) to 4 trillion yuan by the end of the year and renovate 1 million homes.
On the 17th, Ni Hong, Minister of Housing, Urban and Rural Construction of China, the People’s Bank of China and the head of the State Financial Supervision and Administration held a press conference on ‘Promoting the Healthy Development of the Real Estate Market’ and announced the following.
As of this day, the size of China’s white list project loans was 2.2 trillion yuan. The Chinese government’s goal is to double this to 4 trillion yuan by the end of the year. Through this, the plan is to further standardize real estate project management and speed up financing.
This measure attracted attention both inside and outside the market as it was the first new real estate support measure since China announced a large-scale economic stimulus package at the end of last month.
China rolls out ‘real estate measures’ a day ahead of third quarter GDP announcement
The ongoing difficulties in China’s real estate market have been one of the biggest obstacles to China’s growth recovery. Investment in China’s real estate sector decreased by 10.2% in the first eight months of this year compared to the same period last year. Home sales decreased by 23.6%. The real estate sector, along with adjacent industries such as construction, accounts for approximately one-third of China’s annual gross domestic product (GDP). It also accounts for 65% of total household assets.
After China’s announcement of a large-scale economic stimulus package at the end of last month, there were signs that the real estate market was reviving during the National Day holiday. In large cities such as Beijing, Shanghai, and Shenzhen, housing purchases and wishes to purchase have increased. However, China’s commercial real estate market is still struggling.
According to Bloomberg, landlords in big city commercial real estate markets are cutting rents, and some are offering subsidies to attract businesses again. In Shanghai, the office vacancy rate soared to 21.5% in the third quarter of this year. This is the highest level in the last 20 years.
Meanwhile, the General Administration of Customs of China will announce the GDP growth rate for the third quarter of this year and industrial production and retail sales indicators for September on the morning of the 18th. There are many predictions that China’s economic growth rate in the third quarter will be the lowest since the first quarter of last year.
According to the results of a Bloomberg survey of economists, China’s GDP growth rate in the third quarter was analyzed at an annual rate of 4.5%. This is the lowest growth rate in six quarters since the first quarter of 2023 (4.5%). According to experts’ analysis, China’s GDP growth rate in the first to third quarters is 4.9%, which is expected to barely achieve China’s economic growth target of ‘around 5%’ this year.
Reporter Kim Eun-jeong [email protected]
