China's Residential Real Estate Market is in a Super Big Slump, Even With the Government Trying to Help

New-Home Sales are Tanking

So, in July, China's housing market took a major nosedive, and it's like, not looking good at all. The government has been throwing everything at it to keep it afloat, but apparently, it's just not working. Some stats I found say that among the top 100 real estate companies, new-home sales plunged by almost 20% compared to last year, reaching just about 279 billion yuan, which is like 51.7 billion in our money. That's a big deal! And get this, that's even worse than the 17% drop in June, and sales went down by over a third from the month before. This is weird because it seemed like things were looking up in April and May.

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The Government's Help isn't Helping Enough

The thing is, the government has been trying to save the market with this big 42 billion dollar deal, but it turns out that's like a drop in the ocean. Bloomberg says it's only enough to buy less than 1% of the 60 billion homes that aren't sold. Also, the big Communist Party meeting didn't give buyers the warm and fuzzies they needed because they didn't announce any super amazing plans to help out.

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Cities are Like, "You do You" With Pricing

Some cities in China are like, "Okay, enough with the rules," and are letting developers set their own prices now. Zhengzhou in Henan is one of them, and they're just saying goodbye to those pesky price guidance restrictions. Other places like Shenyang, Lanzhou, and Ningde did this earlier in the year, and it's all because the local news site Yicai says so.

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It's Not Just Homes - It's the Whole Economy

This whole real estate mess is like a wet blanket on China's economy. Bloomberg Economics is saying that China might not hit its 5% growth target for the year because of it. And if you look at the stocks of these Chinese developers, they've gone down by a sad 21% this year. That's not good for anyone.

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Taking Forever to Sell Homes

And if that's not bad enough, it's taking way longer to sell all these houses. As of May, it would take an average of 21.3 months to clear out the stock in 50 cities, which is a whole 3.9 months longer than before. Jiemian, another local news site, got this info from China Index Academy.

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Experts are Getting Worried

Some big companies that judge how good or bad things are financially, like S&P Global Ratings and Fitch Ratings, have had to admit that things are worse than they thought. They're now saying that home sales might go down by 15% to 20% this year, which is way more than they expected.

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