{"id":31762,"date":"2023-10-19T09:01:23","date_gmt":"2023-10-19T09:01:23","guid":{"rendered":"https:\/\/innodebt.com\/business\/chinas-housing-market-struggle-will-weigh-on-global-growth\/"},"modified":"2023-10-19T09:01:24","modified_gmt":"2023-10-19T09:01:24","slug":"chinas-housing-market-struggle-will-weigh-on-global-growth","status":"publish","type":"post","link":"https:\/\/innodebt.com\/?p=31762","title":{"rendered":"China\u2019s housing market struggle will weigh on global growth"},"content":{"rendered":"
\n

\n Editor\u2019s Note: <\/b>Sign up for CNN\u2019s Meanwhile in China newsletter which explores what you need to know about the country\u2019s rise and how it impacts the world.\n<\/p>\n<\/p>\n

\n China\u2019s real estate market remains a drag and will put pressure on global growth.\n <\/p>\n

\n New home prices fell in September, a third straight month of decline, according to data released Thursday by the National Bureau of Statistics (NBS), <\/strong>despite Beijing\u2019s efforts to shore up the sector. The data comes at a time when Country Garden, once the country\u2019s biggest homebuilder, is fighting for its life.\n <\/p>\n

\n The property slowdown will impact not just China, but also global growth, the International Monetary Fund (IMF) said on Wednesday.\n <\/p>\n

\n New home prices in 70 major cities fell by 0.1% in September from a year ago, according to a calculation from Refinitiv Eikon based on data from the NBS. On a month-on-month basis, prices dropped 0.2% in September, extending a 0.3% fall in August.\n <\/p>\n

\n The persistent weakness in the housing market is hobbling China\u2019s economic recovery. The country\u2019s gross domestic product expanded by a better-than-expected 4.9% in the third quarter, according to the NBS on Wednesday. That growth was mainly boosted by robust growth in consumer spending.\n <\/p>\n

\n But the real estate sector remains a big problem. <\/strong>Property investments plunged 9.1% in the first nine months of 2023, indicating that investor sentiment is getting worse.\n <\/p>\n

\n The sector, which has accounted for as much as 30% of the economy, fell into crisis more than two years ago after a government-led clampdown on developers\u2019 borrowing.\n <\/p>\n

\n Beijing has rolled out a slew of stimulus measures to revive growth, including cutting mortgage rates and scrapping restrictions on home purchases in cities. But the efforts have so far failed to sustain a rebound in the market.\n <\/p>\n

\n The IMF said China\u2019s property downturn will weigh on global growth prospects.\n <\/p>\n

\n \u201cThe global outlook \u2026 faces pressures from China\u2019s worsening property crisis, tight policy stances around the world, the consequences of Russia\u2019s war in Ukraine, the most recent conflict, and growing geoeconomic fragmentation,\u201d said Krishna Srinivasan, director of the IMF\u2019s Asia and Pacific Department, at a press briefing.\n <\/p>\n

\n The fund recently downgraded China\u2019s growth forecast to 5% for 2023 and 4.2% for 2024, citing a deeper property downturn.\n <\/p>\n

\n Srinivasan said there is need for China to have a \u201ccomprehensive strategy\u201d to address the real estate problem, which involves making sure all pre-financed houses are built. <\/strong>In China, most new homes are sold before they are <\/strong>constructed.\n <\/p>\n

\n \u201cThere\u2019s a problem with the developers, which needs to be sorted out,\u201d he said. \u201cUntil that\u2019s done, it\u2019s going to affect confidence.\u201d\n <\/p>\n

\n Many Chinese property developers are grappling with a cash crisis, with high-profile names like Evergrande on the brink of a messy collapse.\n <\/p>\n

\n Country Garden, once the country\u2019s largest homebuilder by sales, is also at risk of default.\n <\/p>\n

\n A grace period to pay $15 million in interest on a US dollar bond expired this week, with no word of payment from the firm, state-owned Paper.cn reported Wednesday.\n <\/p>\n

\n It could mark the first-ever default by the property giant on its billions of dollars of offshore debt, which could lead to a debt restructuring.\n <\/p>\n

\n Country Garden issued a statement on Thursday, threatening to pursue legal action against anyone spreading \u201cmalicious rumors\u201d about its founder fleeing the country. <\/strong>\n <\/p>\n

\n \u201cThe company is concerned about rumors that \u2018the founder and his daughter may have left the country,\u2019\u201d it said.\n <\/p>\n

\n \u201cThis rumor was posted on multiple online platforms with ulterior motives, causing a negative impact. The founder of our company and the chairman of the group\u2019s board of directors are currently working normally in China,\u201d it added.\n <\/p>\n

\n Yang Huiyan currently chairs Country Garden. She took over the position in March from her father Yang Guoqiang, who founded the property firm in 1992. Previously, she was one of Asia\u2019s richest women.\n <\/p>\n<\/p><\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Editor\u2019s Note: Sign up for CNN\u2019s Meanwhile in China newsletter which explores what you need to know about the country\u2019s rise and how it impacts the world. China\u2019s real estate market remains a drag and will put pressure on global growth. New home prices fell in September, a third straight month of decline, according to […]<\/p>\n","protected":false},"author":1,"featured_media":31763,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-31762","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"yoast_head":"\nChina\u2019s housing market struggle will weigh on global growth | Innodebt<\/title>\n<meta name=\"description\" content=\"Editor\u2019s Note: Sign up for CNN\u2019s Meanwhile in China newsletter which explores what you need to know about the country\u2019s rise and how it impacts the world.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/innodebt.com\/?p=31762\" \/>\n<meta property=\"og:locale\" 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