Chinese real estate firms face 103 billion USD in debt, Fitch sees more defaults

Mainland real estate companies will have about 660 billion yuan (103 billion USD) of debt due this year, and Fitch, an international rating agency, believes that the financial liquidity constraints of Chinese real estate companies will continue for a period…

Chinese real estate firms face 103 billion USD in debt, Fitch sees more defaults

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Mainland real estate companies will have about 660 billion yuan (103 billion USD) of debt due this year, and Fitch, an international rating agency, believes that the financial liquidity constraints of Chinese real estate companies will continue for a period of time this year, which may trigger more defaults.
On January 18th, Zheng Junying, co-head of Fitch Ratings Greater China Real Estate Ratings, said at the bank’s credit outlook meeting that the outlook for China’s real estate industry in 2022 is deteriorating, and the financial liquidity of Chinese-funded real estate firms will continue to be under pressure for a period of time. More default events may be triggered.

According to a Reuters report on January 18th, Fitch expects that the liquidity pressure of housing companies and the consequent decline in market confidence will exacerbate the contraction in annual real estate sales, with contracted sales falling by 10% to 15% this year from the previous year, and the average price is falling by 5%. The operating environment of Chinese-funded real estate companies will continue to face challenges, and it will not be until the second half of the year that the operating and financing environment will see a more substantial recovery.
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