The most important case was that of the former number one in the sector, Evergrande, with nearly 300,000 million dollars in debt.
Furthermore, the uncertainty linked to the COVID-19 pandemic is deterring buyers.
How do buyers react?
The Evergrande crisis sparked buyer demonstrations in September 2021, but a new form of protest appeared in June: a real estate loan payment strike.
Given the delays in the works, the buyers of accommodations that are not yet finished stopped paying the credits until the works are resumed.
Within a month, the strike spread to more than 300 projects in 50 cities in China.
Should the world worry?
Given the interconnection of China, the second world economic power, with the rest of the countries, a contagion of the real estate crisis to the financial sector would have international repercussions, according to analysts.
“If defaults multiply, it could have serious economic and social consequences,” warns the Fitch rating agency.
Already in May, the US Central Bank stated that the worsening of the Chinese real estate crisis could have consequences for the country’s financial system.
In such a scenario, the crisis would impact world trade, says Fitch.