China said on Thursday it would increase credit available to the ailing property market and help renovate a million homes, as it unveiled a new set of measures to support the sector and try to revive the economy.
The faltering real estate sector has long been responsible for about a quarter of gross domestic product and has enjoyed staggering growth for two decades, but a years-long slump in the housing market has battered growth as the country’s leaders set a target of about five percent for envision 2024.
At a briefing on Thursday, Housing Minister Ni Hong offered new aid and said Beijing will “raise the credit scale of whitelisted projects to four trillion” yuan ($562 billion) by the end of the year.
The ‘white list’ program announced earlier this year pushes local authorities to recommend housing projects for financial support and work with banks to guarantee their completion.
“The urban real estate financing coordination mechanism should strive to whitelist all eligible real estate projects,” Ni said.
“Another million worn-out houses will be renovated,” he added. “There are many safety hazards and poor living environments in urban villages, and people are eager to renovate.”
The move, he said, would be “conducive to absorbing the existing stock of commercial housing”.
China’s leaders warned last month that the economy was plagued by “new problems” as officials unveiled a raft of stimulus measures that represented one of the biggest pushes to boost growth in years.
The measures included a series of interest rate cuts, easing restrictions on home buying and measures to free up cash so banks can lend more.
But a blistering market rally on hopes of big stimulus has stalled as authorities have refrained from providing a specific figure for the bailout or detailing the plans.
A number of major cities have also eased restrictions on home buying in recent months – most recently this week in Chengdu, the capital of southwestern Sichuan province, and the northern port city of Tianjin.
The latest announcement comes as China prepares to release third-quarter growth figures on Friday, which are expected to be the slowest this year.
And analysts polled by AFP predict overall growth of 4.9 percent in 2024 – even worse than last year, which was the weakest in decades outside Covid-19.
Still, Beijing has said it is “confident” it will meet the five percent target.
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