China's Housing Crisis

China is grappling with a significant housing crisis characterized by an overabundance of unsold homes. Recent reports indicate that around 27 million homes remain unsold, and additional estimates suggest that up to 40 million homes have been purchased but remain unoccupied as investments. This situation is a direct consequence of aggressive building practices over the years, leading to an unsustainable market where housing sales and prices continue to decline. The government’s attempts to address this issue, including measures like creating a 300 billion yuan relending facility for local governments to buy and convert these homes into social housing, have shown limited success and have prompted concerns about the long-term health of the housing market.