June 24, 2024

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A former official admits that even 1.4 billion people “probably cannot fill” all the vacant homes in China

A former official admits that even 1.4 billion people “probably cannot fill” all the vacant homes in China

Sheldon Cooper/SOPA Images/LightRocket/Getty Images

Residential buildings in Changzhou, China.

China’s population of 1.4 billion will not be enough to fill all the empty apartments spread across the country, a former official said on Saturday, in a rare public criticism of the country’s crisis-hit real estate market.

China’s real estate sector, once a pillar of the economy, has been in decline since 2021 when real estate giant China Evergrande Group defaulted on its debt obligations after a crackdown on new borrowing.

Big-name developers like Country Garden Holdings continue to hover near default to this day, keeping home buyer sentiment low.

As of the end of August, the combined floor area of ​​unsold homes reached 648 million square meters (7 billion square feet), according to the latest data from the National Bureau of Statistics.

That equates to 7.2 million homes, according to Reuters calculations, based on an average home size of 90 square meters (970 square feet).

This does not include the numerous residential projects that have already been sold but are not yet completed due to cash flow problems, or the multiple homes purchased by speculators in the last market rebound in 2016 that remain vacant, which together make up the bulk of unused properties. Area, according to expert estimates.

“How many vacant homes are there now? Each expert gives a very different number, with the most extreme believing the current number of vacant homes is enough for three billion people,” said He Qing, 81, a former deputy head of the Census Bureau.

“This estimate may be a bit large, but perhaps 1.4 billion people cannot fill this number,” he said at a forum in the southern Chinese city of Dongguan, according to a video posted by state media China News Service.

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His negative view of the economically important sector in a public forum contrasts sharply with the official narrative that the Chinese economy is “resilient.”

A Foreign Ministry spokesman said at a recent press conference: “All kinds of comments predicting the collapse of the Chinese economy continue to appear from time to time, but what collapsed is such rhetoric, not the Chinese economy.”