China's central city of Zhengzhou has asked residents to sell their second-hand homes to a local state-owned company and buy new ones instead, in a bid to reduce new-home inventories and boost the local property sector. Local state state-owned company Zhengzhou Urban Development Group Co. will buy 500 second-hand homes from April 20 to June 30, according to a notice released by the Zhengzhou Real Estate Association on Monday. Most of China's small and medium-sized cities have suffered frail property markets, with the entire property sector in a liquidity crisis since a crackdown on high leverage on developers in 2021.

BEIJING (Reuters) - China’s central city of Zhengzhou has asked residents to sell their second-hand homes to a local state-owned company and buy new ones instead, in a bid to reduce new-home inventories and boost the local property sector.

Local state state-owned company Zhengzhou Urban Development Group Co. will buy 500 second-hand homes from April 20 to June 30, according to a notice released by the Zhengzhou Real Estate Association on Monday.

Residents must buy a new home in the main urban area for a total price that is not less than the total price of the home they are selling, the notice said.

Most of China’s small and medium-sized cities have suffered frail property markets, with the entire property sector in a liquidity crisis since a crackdown on high leverage on developers in 2021.

In Zhengzhou, new home prices fell month-on-month for a 12th straight month in March, according to data from China’s statistics bureau on Tuesday.

  • deegeeseEnglish
    52·
    3 months ago

    I suspect the way it’s supposed to work is people will sell old houses with land to the local government and in return get a new apartment in the orphan development.

    Local government gets more land to use for corrupt development projects while at the same time rescuing the white elephant created in the previous round of development.