China’s property market entered the beginning of its traditional peak sales season in September, also known as the “Golden Nine and Silver Ten.” During this time, household consumption in the country tends to increase significantly. 

But the latest research data shows that China’s real estate market continues in its slump, with home prices dropping for a third consecutive month in September.

Chinese media outlet Kanzhongguo, citing survey data from China Index Academy, reported that September home prices in 100 cities cut 0.02% month-on-month. This compared with a 0.01% drop in July and August.

In addition, the average sales of the top 100 Chinese housing firms from January to September plummeted 45.1% from a year ago.

The sales volume of the companies last month reached $80.4 billion (570.96 billion yuan), an increase of 10% from August and a decline of 25.4% over the same period the previous year. 

As reported by Financial Associated Press, analysts think the month-on-month growth was due to the Chinese property market’s low results in both July and August. In September, the 100 firms saw weak growth from a year earlier.

Over the last three quarters, 15 real estate firms had sales exceeding $14 billion (100 billion yuan), a decrease of 12 firms results from a year ago. 

Meanwhile, 100 housing companies earned over $1.4 billion (10 billion yuan). This compared with 148 companies from the year before.

Kanzhongguo noted that many homebuyers across the nation have stopped paying mortgages and the demand for new homes has dropped off as property developers have failed to complete unbuilt projects.

On top of that, a stringent “zero-COVID” policy, record high unemployment, and an economic slowdown have also undermined consumer confidence and prompted them to cut spending. 

As a result, many smaller cities have taken different measures to shore up the property market, including reducing down payments and mortgage rates.

However, it appears that the real estate sector is not picking up. Homebuyers are still struggling and have decided to move into unfinished buildings to put more pressure on developers or solve financial stress.

Yan Yuejin, research director at Shanghai E-House, said the entire property market is highly sensitive to frozen construction projects, as 90% of new homes purchased in China are under construction.

Yan added, “If this issue is not resolved, it will affect property transactions, the government’s credibility, and it could exacerbate the developers’ debt problems.”

Xu, A 55-year-old homeowner by the name of Xu, is living in an unfinished building. She told Reuters about the predicament she and her family are going through.

In early 2018, Jiadengbao Real Estate started construction on Xiulan County Mansion, a 34-tower complex in the southern Chinese city of Guilin, and advertised selling apartments for around $85 per square foot (6,000 yuan per square meter). 

The company promised in its brochures that homebuyers would enjoy riverfront views, the city’s clean air, and amenities such as heated floors and a shared swimming pool. 

Therefore, about a year later, after careful consideration, Xu spent all of her family’s savings to buy a two-bedroom, 753 square feet (70 sq m) apartment in hopes of raising a family for her only son.

But things didn’t go as planned. In June 2020, a court accused Jiadengbao Real Estate’s parent company of illicit fundraising and confiscated $47.2 million (340 million yuan) worth of its properties. This also includes a number of apartments in Xiulan County Mansion.  

As a result, the developer suspended the project in mid-2020. Xu felt like she was “crashing from paradise” hearing the news months later.

After three years of waiting, her family received a room in a high-rise building with living conditions far below the promised quality: unpainted walls, empty power socket, no gas, and no running water. 

Xu told Reuters that she has lived in the room for six straight months, with only a bed covered by mosquito net, several essentials, and empty bottles on the floor.

Her life is climbing up and down the apartment’s stairs several times, carrying big water bottles filled from a hose outside the building.

During the day, she and another 20 homebuyers of the project use the same makeshift outdoor toilet and meet together at a table and benches in the central courtyard area.

Moreover, Xu said that both her son and husband, who live far away in the northern province of Hebei, criticized her for their financial dilemma and don’t want to talk to her.

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