Amid the ups and downs of the U.S.-China trade war over the past year, the Chinese economy has been seriously declining.
China’s onshore real estate market has fallen drastically. Moreover, mainland real estate companies which relied on easy financing will soon face debt repayment for short term borrowings made in 2018 and 2019. As business prospects are increasingly gloomy and cash is harder to come by, various real estate firms have had no choice but to issue bonds overseas and use new debts to pay off old ones.
Chinese Real Estate Market Is Grim
On June 24, a report released by the Institute of Finance and Banking of the Chinese Academy of Social Sciences showed that Mainland China’s third- and fourth-tier cities have insufficient incentives for rising home prices. Some third- and fourth-tier cities experienced an initial surge in housing prices, but due to insufficient subsequent demand, prices could soon enter a downward trend. The local governments’ means of regulating real estate prices are also very limited.
