Reported 8 months ago
To revive the real estate market and increase the cash flow of real estate companies, more and more cities in China are encouraging state-owned enterprises to help 'clear inventory' by acquiring unsold new homes. Over 30 cities have introduced incentive policies for this purpose. The People's Bank of China provided 300 billion yuan in support for state-owned enterprises to purchase unsold new homes as part of the government's efforts to reduce housing inventory. Specific pricing methods for these acquisitions vary by city, with some using cost-based evaluations. Analysts point out that while encouraging state-owned enterprises is beneficial, there may be financial risks involved for local governments. Overall, if 35 key cities and 80 cities can reduce their housing inventory turnover to below 18 months, the required funding for inventory clearance through acquisitions would amount to 1.1 trillion yuan and 1.8 trillion yuan respectively.
Source: YAHOO