Property prices in Shanghai are on the rise. However, China’s national market continues to struggle with a significant surplus of 90 million empty or unfinished apartments.
Many Chinese families invested their savings in real estate, viewing it as a secure investment path. Unfortunately, for many, this has led to financial losses.
China’s housing market has experienced temporary periods of price stabilization. These moments have brought hope for an end to the multiyear decline. However, each stable period has been short, followed by further market deterioration.
Housing prices in major Chinese cities like Beijing, Shanghai, Shenzhen, and Guangzhou showed a slight increase, rising by 2% from February to April. This is according to data from UBS and Centaline, a major real estate brokerage. This uptick comes after a sharp 38% decline since 2021, affecting both the Chinese and global economies.
The housing crash has severely impacted Chinese families who invested a significant portion of their savings in property, believing it to be a safe financial strategy. For many, this has led to financial hardship.
An example is Timothy Liu from Henan Province. He purchased an apartment for $76,000 in 2021. Since then, its value has decreased by nearly a third. Liu, like many others, lost his job due to the economic slowdown, worsened by the housing market issues.
Liu chose to buy a modest home in a low-cost area and paid in cash, avoiding a huge mortgage in a major city. Despite this, his property’s value has still dropped by about 30%, a situation that has left him frustrated.