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While records are meant to be broken, not all of them are welcome. In April 2022, China’s property market posted the biggest sales drop since 2006, courtesy policy interventions and cooling demand for housing in a post-COVID-19 world.
What’s happening
📉 Realty sales nosedived by 46.6% this April from the year-ago period.
📉 It’s the biggest such fall since August, 2006.
📉 Fyi, March saw a drop of 26.17%, meaning April wasn't a freak show.
📉 Sales came down by 29.5% (YoY) for January-April.
📉 National developer investments fell by 2.7% (YoY) for Jan-April. Also, it fell by 10.1% in April (YoY).
📉 New constructions came down by 26.3% in the Jan-April period.
What Beijing is doing
Mortgage interest rates have been reduced even more, over 80 Chinese cities are taking demand-revival steps, while subsidies and smaller down payments are being dished out like tomato-and-egg soup.
These lifebuoys came only after authorities tightened the noose on high borrowing by real estate developers earlier, sparking fears of stalled projects galore. However, the outlook stays painfully grim, and with lockdowns continuing, things could get even worse, feel experts.
Brake-check reasons
Lockdowns. Unemployment. Falling Income. Uncertainty. In that order. Even Komatsu (construction equipment maker) saw machine usage plunging by 16.6% last month.
Kind of tells the whole story doesn’t it?