China's property loan contraction eases after government support
Government efforts to bolster the market are beginning to take effect
CHINA’S outstanding property loans were down 0.2 per cent at the end of the fourth quarter, less than the prior year’s 1 per cent decline, central bank data showed on Friday (Feb 14), indicating government efforts to bolster the market were beginning to take effect.
Outstanding property loans at the end of 2024 stood at 52.8 trillion yuan (S$9.75 trillion).
Of the total, outstanding loans allocated for real estate project development rose 3.2 per cent from the prior year to 13.56 trillion yuan. Outstanding individual mortgage loans came in at 37.68 trillion yuan, down 1.3 per cent compared with a 1.6 per cent fall at the end of 2023.
China’s property market has faced a severe crisis since 2021, when a government-led initiative to crack down on indebted developers eroded consumer wealth and household spending.
Policymakers have rolled out multiple measures since September to stabilise the market, including cutting mortgage rates and launching a relending facility for local governments to buy unsold homes, with more stimulus pledged for this year.
In the central bank’s monetary policy implementation report released on Thursday, the property sector joined the list of key areas for more credit support.
Funding support from the central bank helps, but fiscal policy or public funds matter more, according to a research note from Citi on Friday. REUTERS
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