China’s top real estate industry body to hold meeting on issues in housing market amid Evergrande crisis
Published: Oct 12, 2021 09:08 PM
Potential homebuyers look at a property model in Huai'an, Jiangsu province.Photo:Xinhua

Potential homebuyers look at a property model in Huai'an, Jiangsu province.Photo:Xinhua

China's top real estate industry body is planning to convene a meeting of industry leaders on Friday to address issues in the housing market, as debt troubles at Evergrande Group continue to spark concerns and speculations about the country's property sector. 

The China Real Estate Association plans to hold an internal meeting on Friday in Beijing to evaluate difficulties and challenges faced by real estate companies, a source close to the matter confirmed with the Global Times on Tuesday. Other media outlets also reported on the planned meeting.

The meeting will bring in high-level executives from housing enterprises, in an effort to make a thorough probe into the problems and address the turbulence in the market.

Separately, the real estate industry association in Chengdu, Southwest China's Sichuan Province, said in an announcement on Tuesday that it plans to hold a meeting on Thursday to address the operational situations, problems and difficulties faced by property companies.

The probes, which come after the nation's banking regulator urged financial institutions to ensure a stable housing market, signal a regulatory change, Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, told the Global Times on Tuesday.

At a meeting in late September with executives of 24 major banks from across the country, regulators emphasized the importance of a prudent real estate finance management system for stabilizing home prices after Chinese property giant Evergrande Group faced a major debt problem.

The fourth quarter will be a turning point in real estate policy, as housing enterprises are faced with sluggish sales, financial difficulties and debt crises, following the Evergrande's incident, Yan said.

Data show that transactions continue to decline, and many cities have seen falls in new home transactions for four consecutive months.

Transaction volume for newly built commercial housing in major cities decreased by 33 percent during the National Day holidays or the Golden Week, compared with the same period in 2020, as consumer sentiment was softer than expected, according to statistics published by the China Real Estate Index System.

There are also financing difficulties and liquidity pressure after fundraising channels tightened due to the deterioration in credit of housing enterprises following the Evergrande incident, Yan said.

A wait-and-see mood among consumers has become prevalent in the industry in first-tier cities. China-based real estate services provider Beike Zhaofang said on Tuesday that the company is readjusting its financial business in Shanghai due to the changed industry environment. It reportedly laid off an entire team in Shanghai.

In Beijing, 26 of the 43 auctions for residential land drew no bids as the tender period closed on Monday, according to media reports.