From Bloomberg, May 14:
- Beijing is seeking feedback on preliminary proposal: people
- Move comes as officials vow to address biggest drag on economy
China is considering a proposal to have local governments across the country buy millions of unsold homes, people familiar with the matter said, in what would be one of its most ambitious attempts yet to salvage the beleaguered property market.
The State Council is seeking feedback from several provinces and government entities on the preliminary plan, said the people, asking not to be identified discussing a private matter. While China has already experimented with several pilot programs to clear excess housing inventory with the help of state funding, the latest plan would be much larger in scale.
Local state-owned enterprises would be asked to help purchase unsold homes from distressed developers at steep discounts using loans provided by state banks, according to two of the people. Many of the properties would then be converted into affordable housing.
Officials are still debating details of the plan and its feasibility, the people said, adding that it could take months to be finalized if China’s leaders decide to go ahead. The housing ministry didn’t respond to a request for comment....
.... Unsold housing inventory climbed to 3.6 billion square feet last year, the highest since 2016, official data showed. It will cost at least 7 trillion yuan ($967 billion), or 78% of China’s budget deficit this year, for the government to absorb the inventory in 18 months, Tianfeng Securities estimated....
....MUCH MORE
That's the unsold stuff. There are another 30 million apartments that were purchased as retirement assets and never lived in because it was assumed future buyers would want that "new apartment smell."
If interested see December 2021's "CORRECTION—China Does NOT Have 90 Million Empty Apartments".
