Chinese Real Estate Investment Drops 5.7% in First Quarter, Property Company Loans Plunge over 9%

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China has seen a sharp drop in levels of investment in real estate development in the first quarter of 2023, alongside a modest fall in sales of commercial housing.

From January to March, national real estate development investment in China was 2.5974 trillion yuan, for a year-on-year decrease of 5.8%, according to figures released by the National Bureau of Statistics on 18 April. Residential investment was 1.9767 trillion yuan, for a YoY decline of 4.1%.

The construction area of real estate development enterprises was 7.64577 billion square meters during the period, down 5.2% in YoY terms. The construction area for residential buildings was 5.38214 billion square meters, fora. decline of 5.4%.

China’s newly-started construction area for January to March was 241.21 million square meters, for a YoY plunge of 19.2%. The newly-started construction area for residential buildings was 17.719 million square meters, down 17.8% in YoY terms.

The completed construction area was 194.22 million square meters for January to March, for a YoY increase of 14.7%. The completed construction area of residential buildings was 14.396 million square meters, for an increase of 16.8%.

From January to March, the actual placedl funds of real estate development companies totalled 3.4708 trillion yuan, for a YoY decline of 9.0%. Domestic loans were 499.5 billion yuan, down 9.6%, while utilised foreign capital was 800 million yuan, for a decline of 22.7%.

Self-raised funds were 1.0171 trillion yuan, down 17.9%; deposits and prepayments were 1.1909 trillion yuan, down 2.8%, while personal mortgage loans were 618.8 billion yuan, down 2.9%.

Residential building sales see slight increase in first quarter

From January to March, the sales area for commercial housing was 299.46 million square meters, for YoY decrease of 1.8%. The sales area of residential buildings increased by 1.4%, however.

As of the end of March, the area of commercial housing on sale was 647.70 million square meters, for a YoY increase of 15.4%. The area of residential buildings on sale increased by 15.5%.

The sales value for commercial housing was 3.0545 trillion yuan in the first quarter, for an increase of 4.1%, while the sales value of residential buildings increased by 7.1%.