China Unveils New Measures To Revitalize Real Estate Sector
Date
10/17/2024 3:12:00 AM
(MENAFN- The Rio Times) China's Ministry of housing has announced a series of measures aimed at boosting the country's Real estate sector. The government plans to accelerate credit for struggling property developers and renovate one million apartments in urban areas.
This strategy mirrors the approach used during China's previous real estat crisis. The ministry will allocate more funds to housing projects on the government's "white list."
Banks will issue 4 trillion yuan in loans, equivalent to $714.3 billion ($), by the end of this year. Housing Minister Ni Hong has urged banks to lend to as many projects as possible.
Projects on Beijing's "white list" can receive government-backed financing to complete unfinished apartments and ensure home deliveries.
As of Wednesday, loans for qualified projects stood at 2.23 trillion yuan. Xiao Yuanqi, deputy director of the State Financial Regulatory Administration, stated this amount will double by the end of 2024.
The Housing Minister revealed plans to renovate one million apartments in urban areas by monetizing resettlements. This program echoes a similar state-funded slum reconstruction initiative launched in 2015.
Back then, local governments compensated residents of demolished homes with cash or new housing. State banks will provide financial support, and local governments can issue special-purpose bonds to fund the reconstruction.
China's Real Estate Recovery
Commercial banks may also extend loans to these projects, according to Minister Ni. China's central bank is considering measures to incentivize property ownership.
It may allow policy banks and commercial lenders to provide loans to real estate developers for land purchases. The bank might use pass-through instruments to offer this type of loan to banks.
The prolonged real estate crisis has significantly impacted China's economy . Following a series of stimulus measures announced by the central bank last month, the property market has shown tentative signs of recovery.
Minister Ni expressed optimism, stating that October's real estate data should show "positive and encouraging results." These new measures represent the government's latest effort to support growth in the world's second-largest economy.
The real estate sector plays a crucial role in China's economic landscape, and its recovery is vital for overall economic stability and growth.
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