Jun 29, 2022
Chinese Property Titan Says Housing Market Has Reached Bottom
Bloomberg News
,![A worker walks past scaffolding at the Sunac Resort project construction site, developed by Sunac China Holdings Ltd., in Haiyan, Zhejiang Province, China, on Friday, Feb. 25, 2022. A widely-anticipated push by China's government to boost construction in order to stabilize growth in the world's second-largest economy has yet to materialize, a blow to hopes that Chinese stimulus would lift global growth early on this year. Photographer: Qilai Shen/Bloomberg, Bloomberg A worker walks past scaffolding at the Sunac Resort project construction site, developed by Sunac China Holdings Ltd., in Haiyan, Zhejiang Province, China, on Friday, Feb. 25, 2022. A widely-anticipated push by China's government to boost construction in order to stabilize growth in the world's second-largest economy has yet to materialize, a blow to hopes that Chinese stimulus would lift global growth early on this year. Photographer: Qilai Shen/Bloomberg](/polopoly_fs/1.1785313.1656479844!/fileimage/httpImage/image.jpg_gen/derivatives/landscape_620/a-worker-walks-past-scaffolding-at-the-sunac-resort-project-construction-site-developed-by-sunac-china-holdings-ltd-in-haiyan-zhejiang-province-china-on-friday-feb-25-2022-a-widely-anticipated-push-by-china-s-government-to-boost-construction-in-order-to-stabilize-growth-in-the-world-s-second-largest-economy-has-yet-to-materialize-a-blow-to-hopes-that-chinese-stimulus-would-lift-global-growth-early-on-this-year-photographer-qilai-shen-bloomberg.jpg)
(Bloomberg) -- The worst of China’s record housing slump is finally over, according to the country’s second-largest developer.
“In the short term, the market has bottomed out, but the recovery is a slow and gentle process and will take time,” China Vanke Co. Chairman Yu Liang said at the company’s annual general meeting Tuesday, according to a transcript posted on its WeChat account.
Yu cited a mild sales increase in May from April in first- and second-tier cities, adding that the recovery may become more distinct in June. That would be welcome news for developers, which are counting on a sales rebound to ease a crippling cash crunch that triggered a wave of defaults.
A Bloomberg Intelligence gauge of developer stocks climbed as much as 2.7% to the highest in a month after Yu’s comments.
Signs of improvement in the housing market have emerged after local governments eased some buying curbs and authorities cut mortgage rates. New-home sales in 17 cities monitored by China Index Holdings surged 89% so far in June from a month earlier, also helped by a loosening of Covid restrictions.
Still, Yu doesn’t foresee a return to the boom years. “The industry has entered a new stage of development,” he said.
China’s housing sales have fallen year-on-year for 11 months straight, a record since the nation’s private property market began in the 1990s. Inventories remain elevated and there’s no sign of growth in new construction, Bloomberg analysis shows.
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