Chill Wind Blows through Chinese Property Sector

From Reuters:

A credit crunch, dwindling transactions and falling prices in some hot markets add up to trouble for China’s industry, a key pillar of growth for the world’s fourth-largest economy.

Although official figures show investment in property still grew 32 percent in the first four months from a year earlier, developers are battening down the hatches as bank loans dry up and the cost of tapping other sources of funds rises.

Dropping home sales are a particular threat to developers, who typically rely heavily on cash from the pre-sale of unfinished projects to fund operations and further expansion.

June 9, 2008 6:48 PM
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Categories: Economy