In China, home buyers occupy their ‘rotting’, unfinished properties

 For six months, Ms Xu’s home was a room in a high-rise apartment in the southern Chinese city of Guilin, which she bought three years ago, lured by brochures touting its riverside views. and attract the city. clean air.

However, their living conditions are far from those promised: unpainted walls, holes where electrical sockets should be located and no gas or running water. Every day she climbs up and down several flights of stairs with heavy water bottles filled with a hose to the outside.

“All the family’s savings were invested in this house,” Xu, 55, told Reuters from the Xiulan County Mansion complex, her room bare except for a mosquito net-covered bed, a few necessities and empty bottles on the floor. She declined to give her full name, citing the sensitivity of the matter.

Xu and about 20 other buyers who live in Xiulan County Mansion share a makeshift toilet outside and gather during the day at a table and benches in the central courtyard.

They are part of a movement of homebuyers around China who have moved into what they call “rotting” apartments, either to pressure developers and authorities to complete them or out of financial distress as many cash-strapped builders halt construction stop amid the depth of the country’s real estate slump.

Shanghai E-House Real Estate Research Institute estimated in July that discontinued projects accounted for 3.85% of China’s housing market in the first half of 2022, equal to an area of ​​231 million square meters.

While some local governments have taken steps to support the property market by setting up bailout funds, buyers like Xu, who paid deposits upfront and are on the hook for mortgages, remain in limbo.

MORTGAGE STRIKES

The proliferation of unfinished apartments has sparked unprecedented collective disobedience, fueled by social media: In late June, thousands of homebuyers in at least 100 cities threatened to stop mortgage payments to protest stalled construction.

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The overall property market is highly sensitive to cases of unfinished apartments, as 90% of new homes bought in China are bought “off plans” while still under construction, said Yan Yuejun, research director at Shanghai E-House.

“If this problem is not resolved, it will affect property transactions, the credibility of the government, and it may increase the debt problems of the developers,” he said.

China’s deep property slump, along with disruptions caused by strict anti-COVID measures, are dragging down the world’s second-largest economy, just as the ruling Communist Party prepares for its once-in-five-years Congress next month.

‘CRASHING FROM PARADISE’

Xu bought her two-bedroom, 70-square-meter flat in early 2019, about a year after its developer, Jiadengbao Real Estate, began construction and began selling apartments for about 6,000 yuan ($851) per square meter. , which they said would come with facilities such as underfloor heating and a shared pool.

The work went quickly at first, with blocks in the planned 34 tower complex going up one after the other.

But in June 2020, Jiadengbao Real Estate hit the headlines after a court accused its parent company of illegal fund-raising and seized 340 million yuan of its properties, including a number of flats in Xiulan County Mansion.

Construction stopped in mid-2020, which Xu found out months later, describing her feelings at the time as “crashing from paradise”.

Jiadengbao Real Estate did not respond to a request for comment from Reuters.

Since the debt crisis erupted in 2021, thousands more homebuyers have been caught in similar problems as cash-strapped developers in bankruptcy or abandoned struggling projects.

FENCING AND UNDERGROWTH

On a recent day, the main block of buildings in Xiulan County Mansion was surrounded by a high blue fence, while the clubhouse, announced in promotional material, was covered with dense undergrowth. Cement mixers, iron poles and piles of waste lay strewn about.

Xu, who is unemployed, said she bought the apartment for her only son, hoping he would raise a family there. She said her son and her husband, who live far away in the northern province of Hebei, blame her for her financial problems and no longer speak to her.

“We don’t know how long we will have to live here because the government hasn’t said anything officially,” she said.

She hopes the Guilin government will step in to help.

The city government did not respond to a request for comment from Reuters.

Housing authorities in Baoding, the northern city where Xu is from and where the parent company of Jiadengbao Real Estate is registered, said last November that the city government and the Communist Party Commission had set up a group to solve the problem.

“If the government really wants to protect people’s livelihood, and resume construction, we will return home,” Xu said.

https://toptrendnewz.com/in-china-home-buyers-occupy-their-rotting-unfinished-properties/