Shanghai homebuyers warn of mortgage boycott as property crisis spreads to mainland China’s financial and commercial hub

Dozens of homebuyers in Shanghai have threatened to stop repaying mortgages as they protest against a developer’s delay in handing over flats, evoking memories of a nationwide boycott about a year ago that spread to more than a hundred cities as builders were behind schedule due to tight funding and strict Covid-19 curbs.

These boycott warnings come at a time when property sales are sinking and could further pressure the liquidity starved sector. Property sales declined 33 per cent year on year in July, extending a 17 per cent fall in June.

The One – Rivera Shanghai, a project located on Puyi Road, Pudong, stalled construction due to a liquidity crunch it has faced since early 2022, which forced the company to miss delivery deadlines stipulated in the home purchase contracts.

According to two buyers who asked not to be identified, about 100 people whose flats were not delivered on the due date have written to the developer and relevant housing and financial authorities complaining about the lapse and have warned they would stop making mortgage payments from September if construction did not resume by end-August.