A slump in the property market across the country is forcing developers into imaginative ways to boost sales, including using crops towards a deposit.
According to Reuters, one advertisement of Henan-based developer central China that had “swap wheat for a house” in the title says buyers can use their crop, priced at 2 yuan per catty, a Chinese unit of mass equal to roughly 500 grams, to offset as much as 24,000 dollars in down payments towards one of its developments. Another Central China advertisement said buyers of houses in another development could make down payments in garlic at 5 yuan per catty. The garlic promotion attracted 852 visits and 30 transactions involving around 860,000 pounds of garlic during the 16 days it was available. These promotions are targeting local farmers.
Major disruptions caused by the Zero-COVID policy have upended factory and retail activity and cast a cloud over the economy. Beijing is scrambling to rescue the property sector, which is buckling under huge debts. The weakening yuan is also piling pressure on property developers. Failing to save the housing market could undermine China’s 5.5 percent economic growth target.
According to Ma Xiaoming, a senior media person in mainland China, forced evictions have become a means for the authorities to save the economy.
Fifteen cities, including Zhengzhou and Wenzhou, have introduced a house-ticket resettlement policy, The demolition will no longer be compensated for in cash, but a house ticket is to be issued, forcing the demolition households to buy commercial housing. In many cases, the new house is much more expensive than the ticket value, so the family has no choice but to pay a huge price difference. The ticket is only valid for 12 months from the date of issue.
Zhongxin Finance described the introduction of the house ticket measures as “Welcome back to the 1970s?!” and pointed out that “many netizens directly said that they had the feeling of traveling through the last century.”
Zhang Jian, an expert on China issues, said that real estate is the largest reservoir for the CCP to maintain fiscal revenue. When it bottoms out, authorities will find a way to turn people’s money into their own money. It used to be a restriction on buying a house, it turned into an incentive to buy a house, and then it became an executive order to buy a house.
In Qingdao, authorities require each cooperative to complete at least two online-signed commercial houses by the end of June; there is also a warning for demolition households that don’t buy a new house or have a considerable deposit in the bank. NetEase said experts recommend punishing those who “refuse to buy a house.”