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March 1, 2024
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Weekend: Ex-PBoC official says China’s property downturn may continue for two more years

Sheng Songcheng is a former director of the People’s Bank of China’s statistics and analysis department. He was speaking at a forum in Shanghai on Saturday.

Said that the property downturn in China is likely to persist for two more years. It will begin to regain stability after that.

  • New-home sales nationwide will likely shrink by another 50 million square meters both in 2024 and 2025
  • 2025 annual total will plateau around 850 million square meters
  • there were some ‘green shoots’ appearing in November and December, such as the pace of sales decline moderating by a half in 2023 from a year earlier

Info comes via Bloomberg (gated).

The recent events in the property sector in China include:

  • the slide in Chinese home sales accelerated in December
  • authorities have rolled out more support measures, such as relaxing homebuying curbs in major cities

The property sector is (was) a key growth engine for the economy, but in the past three years its been a drag, and has also contributed to heightened financial risks due to the unprecedented wave of developer defaults.

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