China’s housing market facing ‘year of recession’, securities firm says
- Negative forecasts for the country’s real estate market, a key driver of growth, are multiplying
- CICC predictions for 2019 say sales will fall for the first time in five years
Bearish calls for China’s housing market, a key driver of the world’s second-largest economy, are multiplying as the government maintains its home-purchase restrictions.
In recent forecasts for next year, securities firm China International Capital Corporation (CICC) said new home sales could slide 10 per cent, while S&P Global Ratings said prices may fall by as much as 5 per cent and CGS-CIMB Securities predicted a 10 per cent decline in prices and sales volumes.
CICC has called 2019 the “year of recession” for real estate, with sales to fall for the first time in five years. S&P said some developers could be dragged down in a sliding sector, calling their financing landscape “the most unfavourable in years”.
The next data for 70 major cities will come on Thursday, after the government last month reported the first slowdown in property price inflation in seven months.
Officials are grappling with keeping housing affordable and reining in prices without imposing an excessive drag on the economy.