China’s housing ministry has disclosed that more than 200 billion yuan ($28 billion) in bank loans have been greenlit for property projects, signaling a concerted effort by lenders to bolster the beleaguered real estate sector. According to the ministry’s announcement on Friday, commercial banks have sanctioned this amount as of February 28, marking a significant increase from the approximately 29 billion yuan reported as of February 20. Over 6,000 projects have now been added to so-called white lists, rendering them eligible for housing support.
In response to a prolonged debt crisis plaguing developers and hindering project completions, policymakers have intensified pressure on banks to ramp up property loans through these white lists. However, despite these efforts, the property market continues to struggle, with home sales experiencing a further downturn in February.
Data from China Real Estate Information Corp. revealed a staggering 60% year-on-year drop in the value of new home sales by the top 100 real estate companies last month, following a 34.2% decline in January.
In an attempt to address the ongoing challenges, the housing ministry has urged local governments to facilitate negotiations on residential projects rejected by lenders and subsequently recommend them to banks once they meet the required standards. Chen Wenjing, a researcher at property agency China Index Holdings, emphasized the regulatory urgency reflected in the ministry’s swift actions, including its second internal meeting within a span of 10 days to expedite implementation.
