Real Estate Trust Products See Near 30% On-month Plunge in August


The Chinese real estate trust sector cooled considerably in August as financial regulators put pressure on the flow of funds into the housing market.

The latest data from Yang Lee (用益信托) indicates 68 trust companies in China issued a total of 281 assembled real estate trust products in the month of August, for a 46.4% decline compared to the 524 products issued in July.

Products issued in August were worth approximately 58.082 billion yuan, for a drop of almost 27% compared to the reading of 79.523 billion yuan for July.

Domestic analysts impute the decline in real estate trust product issuance to heightened pressure on the sector from Chinese regulators.

Sources said to Economic Information Daily that local banking and insurance regulators hare been implementing “window guidance” of trust companies within their respective jurisdictions, requiring that the scope of real estate trust products at the end of the third quarter be no greater than that at the end of the second quarter.

The “China Residential Housing Financial Development Report” (国家金融与发展实验室发布) released by the National Institution for Finance & Development on 29 August points out that real estate enterprises are still a key target area for regulatory efforts.