CHINA 60 Million Unsold Apartments Nightmare for Economy in 2024 as Property Crash Continues
Video Summary
China’s property sector has been struggling, with a significant impact on the country’s overall economy. The sector, which accounts for 25% of China’s GDP, has been in a downward spiral since 2018. The problem is not just a matter of a lack of confidence among buyers, but also a massive overhang of unsold apartments, with over 60 million units sitting vacant. This has led to a sharp decline in property prices, with a 3.5% drop in new home prices and 6.8% drop in second-hand prices over the past year.
The Chinese government has introduced initiatives to address the issue, including reducing mortgage costs and deposit requirements, but these efforts have been met with limited success. In fact, a trial program to have local authorities buy up unsold apartments and convert them into social housing has actually had a negative impact, driving down prices further.
The situation is dire, and it’s not just a matter of China’s economy, but also the global economy. If China, the second-largest economy in the world, continues to struggle, it will have a significant impact on global trade and commerce. With over 60 million unsold apartments, it’s clear that something needs to be done to address the crisis. However, the outlook is bleak, and the 5% GDP growth target for 2024 looks increasingly challenged.
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