China’s real estate crash spirals: Builders fail, buyers flee, cities hollow out. Turns out concrete isn’t a liquid asset after all.
“New home prices in 70 major cities fell for a 24th straight month in May, extending the longest losing streak since at least 2011”
https://www.reuters.com/markets/asia/chinas-home-prices-dip-may-extending-two-year-stagnation-2025-06-16
“The amount of unsold residential floor space stood at 512 million square meters in February, roughly ten times the size of Manhattan’s total office area”
https://www.atlanticcouncil.org/blogs/econographics/theres-less-to-chinas-housing-bailout-than-meets-the-eye
“From January to May 2025, real estate investment plunged 11.1 % and residential sales dropped 2.7 %”
https://www.reuters.com/markets/asia/analysts-downgrade-chinas-property-price-outlook-2025-trade-tensions-pose-fresh-2025-05-23
This isn’t a cyclical slump. It’s a wipeout of fake collateral. The foundation of China’s local government financing has cracked. Land sales have collapsed across third- to fifth-tier cities. That revenue once funded schools, pensions, transit, and state wages. It is gone.
Evergrande faces forced delisting. “Evergrande has failed to issue its 2023 results and is unable to meet listing requirements after defaulting on over $23 billion of offshore bonds”
https://www.reuters.com/world/china/evergrande-faces-delisting-china-property-debt-revamp-drags-2025-07-30
Meanwhile, Vanke is scrambling to survive. “Vanke brought in state-owned Shenzhen Metro Group to take key board positions after warning of a $6.2 billion loss”
https://www.ft.com/content/f9d35d4d-a4cc-42cf-a5c6-a51977c28ca3
Confidence is shot. Buyers have vanished in smaller cities. Banks are pulling back lending. Local governments are trying to prop up the market by buying unsold homes using off-book funds. But the scale is too big to plug.
“More than 70 % of Chinese developers’ dollar bonds have defaulted since 2021”
https://www.reuters.com/world/china/evergrande-faces-delisting-china-property-debt-revamp-drags-2025-07-30
Goldman Sachs now forecasts another 10 % price decline through 2027. They expect lower-tier housing to take even longer to clear.
https://www.businessinsider.com/china-economy-real-estate-property-crisis-get-worse-goldman-sachs-2025-6
Jobs are disappearing. “Roughly 9 million construction and housing-related jobs have been lost since 2020”
https://www.imf.org/en/Publications/fandd/issues/2024/12/chinas-real-estate-challenge-kenneth-rogoff
Land-based tax revenue is drying up. Local debt loads are spiking. Private wealth is evaporating. HSBC just took a $2.1 billion write-down linked to China property
https://www.thetimes.co.uk/article/hsbc-profits-slump-after-multi-billion-dollar-china-charge-wbwkqkx36
The IMF and World Bank both warned that without deep fiscal and structural reform, China risks entering a decade-long stagnation
https://www.theguardian.com/business/2024/dec/26/world-bank-lifts-china-growth-forecasts-economy-property-crisis
This was never just about buildings. It was about the illusion of value. An “invisible monetary reservoir,” as one 2021 paper called it
https://arxiv.org/abs/2111.15327
Now it’s draining. And taking everything with it.
