In the sprawling urban landscapes of China, a peculiar sight has become increasingly common: vast arrays of empty apartments. Despite its staggering population of 1.4 billion, China appears to be facing a conundrum - an excess of vacant homes that even its immense populace couldn't fill.
A Slump in the Property Sector
China's property sector, once deemed the backbone of the nation's economy, began its descent into uncertainty in 2021. This downturn was precipitated by the mammoth real estate entity, China Evergrande Group, defaulting on its debt commitments.
The repercussions of this financial stumble were exacerbated by the government's clampdown on new borrowing, further destabilizing the property market. Even today, prominent developers, including the likes of Country Garden Holdings, hover dangerously close to default, casting a shadow over potential homebuyers and tempering their enthusiasm.
Between Official Stats and Ground Realities
The gravity of the vacant housing crisis was recently underlined by He Keng, a seasoned 81-year-old official who previously served as the deputy head of China's statistics bureau. “How many vacant homes are there now? Each expert gives a very different number, with the most extreme believing the current number of vacant homes are enough for 3 billion people,” He Keng remarked during a forum in Dongguan.
While such a number might sound exaggerated, He Keng's assertion that even China's 1.4 billion citizens would find it challenging to occupy all the empty residences offers a startling perspective on the issue. This stark observation, relayed by the official media China News Service, presents a narrative that diverges sharply from the official government stance on the country's economic health.
Contrary to He Keng's viewpoint, Chinese officials have frequently highlighted the "resilience" of their economy. A spokesperson from the foreign ministry recently commented, “All sorts of comments predicting the collapse of China’s economy keep surfacing every now and then, but what has collapsed is such rhetoric, not China’s economy”.
China's housing surplus poses challenging questions about market dynamics, government regulations, and the future of urbanization in the world's most populous country.