Fresh drama at property developers including China Evergrande Group is jeopardising President Xi Jinping’s latest efforts to end the housing crisis.
Just as China enters a key holiday sales season, a raft of headlines are weighing on already-frail confidence in the property market. Evergrande said it has to revisit its debt restructuring plan and a unit missed a yuan bond payment. Former executives at the defaulted real estate giant have been detained, Caixin reported. Meanwhile, China Oceanwide Holdings Ltd said it is facing liquidation and Country Garden Holdings Co is still trying to avoid a potential default.
The news, which contrasts with a slew of recent government measures to prop up housing demand, has fuelled investor confusion over whether authorities have a unified plan to stabilise the market. It couldn’t come at worse time for Chinese developers counting on the upcoming Golden Week holiday period to spark a long-awaited revival in home sales.
“Any setback in the process will negatively affect the still very fragile market sentiment of almost all players in the sector and defeat the policy purpose,” said Zhi Wei Feng, a senior analyst at Loomis Sayles Investments Asia Pte.
A Bloomberg Intelligence gauge of Chinese developer shares fell 0.7% on Tuesday morning, a day after dropping the most this year as the crisis at Evergrande entered a new phase. The developer scrapped key creditor meetings and said it must rethink its debt overhaul plan, raising the risk of a liquidation of the nation’s most indebted builder.
On top of that, Caixin reported that Xia Haijun, an ex-chief executive officer of Evergrande, and Pan Darong, a former chief financial officer, have been detained by Chinese authorities.
The eight-day national holiday starting Friday is the centerpoint of the industry’s September-October busy season. The stakes are higher than ever this year, as the housing slowdown weighs on China’s economic recovery and developers that are struggling to refinance rely on cash from sales to meet debt obligations.
“Property sales this year have been very lacklustre, so for most developers accelerating transactions in the two months will be especially crucial,” said Zhang Hongwei, founder of Jingjian Consulting, which advises real estate companies. If sales aren’t good enough by October, local governments will roll out more stimulus, Zhang added.
An easing of mortgage restrictions at the end of August triggered a spurt of home sales in larger cities that is already losing momentum. That’s prompting speculation policy makers will need to do more to revive sentiment which has been hammered by worries over unfinished apartments, falling property values, high unemployment and dwindling incomes.
Some builders are already taking aggressive steps to entice homebuyers.
One developer in Guangdong is offering incentives to buyers of its Royal Skyrim apartments in Shenzhen to purchase additional properties elsewhere in the province. They can enjoy down payments of as low as 20% at its project in smaller Dongguan city nearby, according to agents.
Thirteen developers from Harbin, the capital of China’s northernmost province, went to the eastern city of Nanjing to promote their 21 projects earlier this month, hoping that buyers fond of travelling would consider them as holiday residences.
Local authorities are helping out, too. A city government in central Anhui province gave out 5,000 spending vouchers of as much as US$137 (RM642.26) each to homebuyers, according to an official announcement.
To seize the sales window, local authorities have been following each other to stimulate housing demand in recent weeks. Some have loosened rules banning non-residents from purchasing property there.
Guangzhou made such a move in some urban areas last week, marking one of the most significant steps taken in a tier-1 city. Beijing and Shanghai still restrict non-locals from buying property and place limits on how many units each household can own.
“Whether tier-1 cities will step up loosening depends on how much their housing markets recover,” said Chen Wenjing, associate research director at China Index Holdings. “The Guangzhou move signals that it’s not impossible anymore.”
Potential policies include making more people eligible for purchases in suburban areas, where sales are usually more lacklustre. Homebuyers are also watching whether Beijing, Shanghai and Shenzhen will reduce their minimum mortgage rates for first homes to lower floors guided by the central bank earlier this month.
Still, there are entrenched barriers to a recovery that such measures can’t easily overcome. As well as the tough job market, China’s ageing population and an oversupply of housing limit the upside for investing in real estate.
Former People’s Bank of China policy maker Li Daokui said a recovery may take as long as a year and Beijing should do more to encourage lending to cash-strapped developers.
Officials are treading a fine line on how far to push stimulus. While a persistent real estate slump poses risks to the government’s growth target of 5% this year, it wants to reduce the economy’s reliance on a leverage-driven property market in the long run.
For now, the expectation that home values will keep falling is among the biggest factors deterring buyers. Home prices dropped the most in 10 months in August, led by declines in smaller cities.
“Expectations on housing prices have gradually stabilised, but the outlook on most tier-2 cities and smaller cities is still negative,” said Chen at China Index. “For most cities in China, the home market needs to take more time to recover.”
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
In the quest to find cities where renters can enjoy the best of all worlds, a recent study analyzed 24 metrics across three key categories—Housing & Economy, Quality of Life, and Community. The study ranked the 100 largest cities in Canada to determine which ones offer the most to their renters.
Here are the top 10 cities that emerged as the best for renters in 2024:
St. John’s, NL
St. John’s, Newfoundland and Labrador, stand out as the top city for renters in Canada for 2024. Known for its vibrant cultural scene, stunning natural beauty, and welcoming community, St. John’s offers an exceptional quality of life. The city boasts affordable housing, a robust economy, and low unemployment rates, making it an attractive option for those seeking a balanced and enriching living experience. Its rich history, picturesque harbour, and dynamic arts scene further enhance its appeal, ensuring that renters can enjoy both comfort and excitement in this charming coastal city.
Sherbrooke, QC
Sherbrooke, Quebec, emerges as a leading city for renters in Canada for 2024, offering a blend of affordability and quality of life. Nestled in the heart of the Eastern Townships, Sherbrooke is known for its picturesque landscapes, vibrant cultural scene, and strong community spirit. The city provides affordable rental options, low living costs, and a thriving local economy, making it an ideal destination for those seeking both comfort and economic stability. With its rich history, numerous parks, and dynamic arts and education sectors, Sherbrooke presents an inviting environment for renters looking for a well-rounded lifestyle.
Québec City, QC
Québec City, the capital of Quebec, stands out as a premier destination for renters in Canada for 2024. Known for its rich history, stunning architecture, and vibrant cultural heritage, this city offers an exceptional quality of life. Renters benefit from affordable housing, excellent public services, and a robust economy. The city’s charming streets, historic sites, and diverse culinary scene provide a unique living experience. With top-notch education institutions, numerous parks, and a strong sense of community, Québec City is an ideal choice for those seeking a dynamic and fulfilling lifestyle.
Trois-Rivières, QC
Trois-Rivières, nestled between Montreal and Quebec City, emerges as a top choice for renters in Canada. This historic city, known for its picturesque riverside views and rich cultural scene, offers an appealing blend of affordability and quality of life. Renters in Trois-Rivières enjoy reasonable housing costs, a low unemployment rate, and a vibrant community atmosphere. The city’s well-preserved historic sites, bustling arts community, and excellent educational institutions make it an attractive destination for those seeking a balanced and enriching lifestyle.
Saguenay, QC
Saguenay, located in the stunning Saguenay–Lac-Saint-Jean region of Quebec, is a prime destination for renters seeking affordable living amidst breathtaking natural beauty. Known for its picturesque fjords and vibrant cultural scene, Saguenay offers residents a high quality of life with lower housing costs compared to major urban centers. The city boasts a strong sense of community, excellent recreational opportunities, and a growing economy. For those looking to combine affordability with a rich cultural and natural environment, Saguenay stands out as an ideal choice.
Granby, QC
Granby, nestled in the heart of Quebec’s Eastern Townships, offers renters a delightful blend of small-town charm and ample opportunities. Known for its beautiful parks, vibrant cultural scene, and family-friendly environment, Granby provides an exceptional quality of life. The city’s affordable housing market and strong sense of community make it an attractive option for those seeking a peaceful yet dynamic place to live. With its renowned zoo, bustling downtown, and numerous outdoor activities, Granby is a hidden gem that caters to a diverse range of lifestyles.
Fredericton, NB
Fredericton, the capital city of New Brunswick, offers renters a harmonious blend of historical charm and modern amenities. Known for its vibrant arts scene, beautiful riverfront, and welcoming community, Fredericton provides an excellent quality of life. The city boasts affordable housing options, scenic parks, and a strong educational presence with institutions like the University of New Brunswick. Its rich cultural heritage, coupled with a thriving local economy, makes Fredericton an attractive destination for those seeking a balanced and fulfilling lifestyle.
Saint John, NB
Saint John, New Brunswick’s largest city, is a coastal gem known for its stunning waterfront and rich heritage. Nestled on the Bay of Fundy, it offers renters an affordable cost of living with a unique blend of historic architecture and modern conveniences. The city’s vibrant uptown area is bustling with shops, restaurants, and cultural attractions, while its scenic parks and outdoor spaces provide ample opportunities for recreation. Saint John’s strong sense of community and economic growth make it an inviting place for those looking to enjoy both urban and natural beauty.
Saint-Hyacinthe, QC
Saint-Hyacinthe, located in the Montérégie region of Quebec, is a vibrant city known for its strong agricultural roots and innovative spirit. Often referred to as the “Agricultural Technopolis,” it is home to numerous research centers and educational institutions. Renters in Saint-Hyacinthe benefit from a high quality of life with access to excellent local amenities, including parks, cultural events, and a thriving local food scene. The city’s affordable housing and close-knit community atmosphere make it an attractive option for those seeking a balanced and enriching lifestyle.
Lévis, QC
Lévis, located on the southern shore of the St. Lawrence River across from Quebec City, offers a unique blend of historical charm and modern conveniences. Known for its picturesque views and well-preserved heritage sites, Lévis is a city where history meets contemporary living. Residents enjoy a high quality of life with excellent public services, green spaces, and cultural activities. The city’s affordable housing options and strong sense of community make it a desirable place for renters looking for both tranquility and easy access to urban amenities.
This category looked at factors such as average rent, housing costs, rental availability, and unemployment rates. Québec stood out with 10 cities ranking at the top, demonstrating strong economic stability and affordable housing options, which are critical for renters looking for cost-effective living conditions.
Québec again led the pack in this category, with five cities in the top 10. Ontario followed closely with three cities. British Columbia excelled in walkability, with four cities achieving the highest walk scores, while Caledon topped the list for its extensive green spaces. These factors contribute significantly to the overall quality of life, making these cities attractive for renters.
Victoria, BC, emerged as the leader in this category due to its rich array of restaurants, museums, and educational institutions, offering a vibrant community life. St. John’s, NL, and Vancouver, BC, also ranked highly. Québec City, QC, and Lévis, QC, scored the highest in life satisfaction, reflecting a strong sense of community and well-being. Additionally, Saskatoon, SK, and Oshawa, ON, were noted for having residents with lower stress levels.
For a comprehensive view of the rankings and detailed interactive visuals, you can visit the full study by Point2Homes.
While no city can provide a perfect living experience for every renter, the cities highlighted in this study come remarkably close by excelling in key areas such as housing affordability, quality of life, and community engagement. These findings offer valuable insights for renters seeking the best places to live in Canada in 2024.
