"China’s property crisis: stimulus measures unlikely to prop up beleaguered home sales in the long run, Moody’s warns"

We don't link to the SCMP nearly as much as we did before Beijing's crackdown on the pro-democracy protests. The paper, though not as propagandistic as Xinhua or China Daily or Global Times, seemed to morph almost overnight into something closer to a regime mouthpiece.

This article stands in stark contrast to that change.

Talk about walking a tightrope between getting the news out and suffering the fate of Jimmy Lai's Apple Daily. Or Mr. Lai himself, still imprisoned.

From The South China Morning Post, October 24:

• The impact is likely to be short-lived, with home sales remaining sluggish for at least the next six months, the credit ratings agency says
• This is likely to further crimp the ability of developers to meet their mountain of debt obligations, Moody’s says in a report

The positive impact of mainland China’s property stimulus measures is likely to be short-lived, with home sales remaining sluggish for at least the next six months, according to Moody’s Investors Service.

This is likely to further crimp the ability of Chinese real estate companies to meet their mountain of debt obligations, the credit ratings agency said in a report on Tuesday.

In the first eight months of the year, home sales fell 1.5 per cent.

But there have been recent signs that a slew of supportive government measures are at least having some impact.

In September, the weighted average prices of new homes in China fell 1.4 per cent on a monthly basis, half the 2.8 per cent decline in August, according to the country’s statistics bureau, which tracked 70 cities.

 

In top-tier cities such as Beijing and Shanghai, the prices of new homes rose by 0.4 per cent and 0.5 per cent, respectively. Lived-in home prices have also seen some improvement with prices in large cities increasing by about 0.2 per cent to arrest a four-month slide.

Although the market has not yet recovered as a whole, prices in some cities and regions have bottomed out and are showing signs of rebound, said Zhang Bo, chief analyst at the 58 Anjuke Real Estate Research Institute in Shanghai. Market-friendly policies introduced in late August and early September were pivotal, he added.

Moody’s is less optimistic. In September, the company downgraded the outlook for China’s property industry to negative from stable, citing the slow economic recovery and the fact developers were struggling to deliver completed flats to buyers.

 

“We expect the benefit to housing demand from recent supportive policies will be short-lived, and forecast nationwide contracted sales will decline over the next six to 12 months,” it said in Tuesday’s report....

....MUCH MORE

 

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