China’s giant housing market has continued to decline in the past month and another major developer showed signs of financial distress as state-owned enterprises began carving up the carcass of the failing property giant Evergrande. House prices, sales, investment and construction data released on Wednesday all showed renewed signs of the crisis in the market, which accounts up to 30% of the country’s output and which appears certain to drag on the world’s second biggest economy. It comes a day after shares in one of China’s largest developers, Shimao Group,…
Tag: Evergrande
China’s indebted property sector highlights a fading economic revival
China’s economy has become heavily dependent on property development over the last decade. High-rise apartments have mushroomed across hundreds of cities to house a growing white-collar workforce, while glass and steel office blocks are dominating city centres, mimicking Shanghai’s glittering skyline. Valued at more than $50tn after 20 years of rapid growth, Chinese real estate is worth twice as much as the US property market and four times China’s annual income. George Magnus, an associate at Oxford University’s China Centre, says this real estate market ranks as the most important…
Speculation nation: Can Xi Jinping’s property tax deflate China’s housing bubble?
Xi Jinping’s to-do list has seen a lot of ticks in recent months: more flights into Taiwan’s defence zone; suppressing dissenting voices in Hong Kong; clipping the wings of tech barons; outlawing the out-of-school tutoring industry. The list goes on. However, one key initiative – introducing a local property tax – has attracted fewer headlines but is apparently so controversial within China’s ruling Communist party that even Xi is still only able to deal in trial schemes rather than wholesale change. The decision to pilot the tax on all types…
Oil prices climb to fresh highs, UK petrol price hits record – business live
More reaction is coming in from trade unions, economists and analysts to the increase in the national living wage and the minimum wage from next April. Frances O’Grady, general secretary of the Trades Union Congress (TUC) said a boost to the minimum wage was vital “in the middle of a cost-of-living crisis” But the government must set its sights higher. We need a £10 minimum wage now, and we need ministers to cancel the cut to universal credit. This increase won’t come into effect until next spring by which time…
China Evergrande shares fall sharply after $2.6bn asset sale collapses
Shares in the struggling property giant China Evergrande have fallen sharply after plans to offload a stake in one of its units for $2.6bn fell through, casting further doubt over whether it can avert the country’s biggest ever corporate failure. China Evergrande Group, the parent company for the sprawling empire built by former steel industry executive Xu Jiayin, closed down 12.54% in Hong Kong on Thursday. Evergrande announced on Wednesday that it had formally abandoned plans to sell a 50.1% slice of Evergrande Property Services, one of its most profitable…
China’s booming real estate market could spell trouble for the economy | George Magnus
In China today, the buzz is all about how the government there too has stumbled into an energy crisis with widespread power cuts. Yet this and other supply shocks will eventually pass, while the $300bn (£218bn) of debt enveloping China’s second biggest property developer, Evergrande, is of greater significance. It suggests China’s long housing boom is over, and bodes badly for the increasingly troubled economy, with implications for the rest of the world too. China’s real estate market has been called the most important sector in the world economy. Valued…