CHINA IS COLLAPSING

As of July 12, home buyers of more than 100 property projects across provinces including Hubei, Henan, Shandong, Jiangxi, Jiangsu, Hunan and Shaanxi had issued statements saying that they refuse to pay mortgage loans as the properties they purchased have been left unfinished, according to a report to The 21st Century Business Herald.

Of the projects, more than 30 are in central China’s Henan province and many are in the provinces of Hunan and Hubei, according to a report by Caixin.

The construction of the projects had been in suspension due to the developers’ liquidity difficulties, which means the home deliveries would be delayed, forcing them to take actions to safeguard their legitimate rights, the homebuyers said.

The developers of the property projects involved include China Evergrande Group, Sinic Holdings, Greenland Holdings, Sunac China, Kangqiao Group, Xinyuan Group, Sichuan Languang Development Co, Zensun Group and Myhome Real Estate Development Group, etc.

“If the construction of the project does not resume by August 1, we will all stop paying mortgages,” the statement reads.

Refusal to pay mortgages in response to delayed deliveries reflects the lack of effective financial supervision of related banks, especially on pre-sales funds, which may have been misappropriated to meet property developers’ debt payments or provide operating funds, they noted.

https://www.macrobusiness.com.au/2022/07/chinese-lehman-moment-as-jingle-mail-arrives/

https://www.bloomberg.com/opinion/articles/2022-07-14/china-real-estate-mortgage-revolt-hints-at-lehman-like-crisis