China’s property price declines in lower-tier cities take heavy toll on middle class
- Weakened real estate market in smaller Chinese cities is weighing on people’s ability to spend, impeding government’s goal of driving economic growth
- Analysts say some third-, fourth- and fifth-tier cities have suffered due to a lack of industrial development and an outflow of workers seeking better jobs in bigger cities
Like countless parents throughout China, those of 34-year-old Yuan Yin want to do everything they can to support him and his future wife as they prepare to get married.
But the weakened property market in Sheyang county, Jiangsu province, is making it difficult to pull together a wedding dowry – marriage expenses traditionally offered by the groom’s family in the country.
Yuan is a migrant worker, living and working as a freelance photographer in Guangzhou – nearly 1,700km (1,056 miles) away from his parents. They had hoped to provide him and his fiancée with about 800,000 yuan (US$123,000) by selling a small shop the parents own on a main commercial street, but the shop’s value has plummeted amid the coronavirus-fuelled recession, and not a single buyer has inquired about the property since they listed it months ago.
Similar shops nearby have sold for less than 600,000 yuan recently.
Whether I can start a business, get married, or even have a child is based on the value of our family home
“Local home prices [in Sheyang county] have dropped from 10,000 yuan [per square metre] in 2019 to just about 7,000 yuan now,” Yuan said. “Whether I can start a business, get married, or even have a child is based on the value of our family home.
“I bet all ordinary Chinese families think the same.”