13 Hrs
Source:
الاقتصادية
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China housing reform worsens land sales crisis
The land market in China is facing significant upheaval due to reforms in real estate sales policies and their impact on local government revenues. Recently, Beijing canceled a land auction valued at over one billion dollars after only one developer participated, reflecting a decline in demand driven by financial restrictions and increased emphasis on collecting payments upfront. This was followed by a 36% drop in land sales in major cities, with projections indicating that land sale revenues could decrease by up to 30% this year, continuing to decline through 2027, potentially falling by as much as 90% compared to their peak in 2021. Local governments are compelled to seek alternative sources of income, such as higher taxes on individuals and private bonds, while developers face unprecedented challenges in raising funds from home sales. These developments are exerting substantial pressure on China's real estate sector and its overall financial foundation.
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