China is preparing a fresh push to clear its vast housing glut by mobilizing major central government-owned enterprises and bad-debt managers to purchase unsold homes from distressed developers, according to people familiar with the matter.
The plan, still under discussion, would tap some of the country’s largest state-owned players — including China Cinda Asset Management Co. — using as much as 300 billion yuan ($41.8 billion) in funding set aside last year by the People’s Bank of China, people said. The renewed approach follows the limited success of an earlier program that relied on local governments to absorb excess inventory.
The latest effort, reported by Bloomberg News, could help speed the disposal of China’s 408 million square meters of unsold housing — an area larger than Detroit — while easing financial strain on embattled developers. Officials are also weighing scrapping a price cap that has discouraged transactions, in hopes of improving the economics for both sellers and state-backed buyers.
The push comes as China’s property sector faces deepening challenges. New-home sales by the nation’s top 100 developers have fallen more than 20% for two straight months, and the delisting of China Evergrande Group has underscored the industry’s prolonged downturn. There are an estimated 60 million unsold apartments nationwide, which could take more than four years to sell without significant intervention, Bloomberg Economics has estimated.
Progress under the central bank’s existing relending program — launched in May 2024 — has been slow, with less than 6% of the announced loans approved, Bloomberg Intelligence reported this month. Analysts cite mismatches between where unsold homes are located and where affordable housing demand exists as a major obstacle.
Bad-debt managers such as Cinda and Huarong Asset Management Co. have previously been enlisted to stabilize the property sector, acquiring stalled projects and distressed loans. But their own strained balance sheets, after years of exposure to the real estate boom, have limited their capacity to take on new burdens.
Chinese President Xi Jinping last month called for accelerating a “new model” of property development focused on balanced urban planning and renovation, but stopped short of unveiling large-scale stimulus. UBS Group AG and other analysts have pushed back expectations for a meaningful housing recovery to mid-to-late 2026, as weak consumer demand and a fragile job market continue to weigh on sentiment.
