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Chinese regulators meet with developer Evergrande as scrutiny on real estate grows – CNBC

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A banner promoting the Emerald Bay residential project outside the China Evergrande Centre in the Wan Chai area of Hong Kong, China, on Friday, July 23, 2021.
Lam Yik | Bloomberg | Getty Images

BEIJING — Chinese authorities called for indebted property giant Evergrande to resolve its debt risks during a rare meeting with executives Thursday.

Shares of Hong Kong-listed China Evergrande Group have tumbled more than 60% this year to near four-year lows as investors worried about the developer’s ability to repay its debt. The stock closed 1.6% lower Friday, giving up initial gains.

The People’s Bank of China said Thursday in an online statement that it, along with the China Banking and Insurance Regulatory Commission, told Evergrande executives they need to implement the central government’s strategy for stable and healthy development of the real estate market.

The statement added Evergrande needs to “actively resolve” debt risks, support financial stability and disclose true information in accordance with regulations, according to a CNBC translation of the Chinese text.

The comments come a few days after Chinese President Xi Jinping said at a high-level economic policy meeting that the country needs to prevent major financial risks.

Evergrande confirmed the meeting with regulators in an online statement Friday and said it would comply with those specific requests.

As one of China’s largest privately run real estate conglomerates, Evergrande sits at the intersection of major concerns for Beijing: speculation in the property market, high debt levels and the sustainability of an industry that fuels more than a quarter of GDP.

Evergrande has more than 240 billion yuan ($37 billion) in bills and trade payables — such as materials — to settle with contractors over the next 12 months, S&P Global Ratings said earlier this month. About 100 billion yuan, or just over 40%, is due by the end of December, S&P said.

The ratings agency downgraded Evergrande and its subsidiaries to “CCC” from “B-” on Aug. 5 on expectations the conglomerate’s “nonpayment risk is escalating because of increased asset freezes from various commercial parties, indicating strained liquidity.”

“The negative outlook reflects Evergrande’s increasing strained liquidity and nonpayment risk. It also reflects our view that its asset disposal plan, though potentially substantial, lacks visibility or certainty,” S&P said in a note.

An analyst was not available Friday to comment on the meeting with regulators.

Chinese authorities have been trying to limit speculative activity in the property market, which, together with related industries such as construction, accounts for more than a quarter of China’s GDP, according to Moody’s estimates published in a late July report.

Beijing is particularly concerned about a buildup in debt used to fuel property development. In the last year, three “red lines” have emerged for limiting the amount of debt real estate companies can hold relative to their assets.

The latest developments around Evergrande reflect authorities’ focus on limiting risks in the real estate market with greater regulation for the rest of this year, said Bruce Pang, head of macro and strategy research at China Renaissance.

“A favorable regulatory environment and fine-tuning policy curb are crucial to decide whether Evergrande could ride out its crisis smoothly,” Pang said. “Investors will closely follow the potential deals for signs on how much leniency Evergrande has won from Beijing, [regarding] the property sector’s liquidity issues amid a campaign to balance between curbing financial risks and securing social stability.”

The Chinese regulators’ meeting with Evergrande comes as Beijing has accelerated its regulation of different fast-growing industries — primarily tech-related — in the last year.

In early November, the central bank, banking and insurance regulator and other departments met with Alibaba founder Jack Ma and executives of financial technology giant Ant Group. A few days later, Ant had to suspend its massive IPO, and began a series of meetings with regulators that has forced the company to restructure as a financial holding company.

Previously, in the last few years, Chinese authorities have stepped in to limit the debt-fueled expansion of conglomerates such as airline operator HNA and insurance company Anbang.

Rising household debt

Reducing property market risks is even more critical for China since the majority of household wealth is tied up in real estate, at about 70% to 80%, according to Moody’s estimates. The report added about 10% of total household income is related to property.

While authorities have repeatedly stressed that “houses are for living in, not speculation,” Chinese households’ greater preference for investing in property than stocks or other assets has contributed to rising real estate prices.

That, in turn, has caused Chinese household debt to rise.

The balance of consumer housing loans has only climbed over the last several years, to reach 36.6 trillion yuan as of the end of June, according to official data. The 13% year-on-year growth rate was slower than the 14.5% rate of 2020.

The inability of the property market to serve individual housing needs has contributed to a rapid rise in household debt, said Liu Xiangdong, deputy director of the economic research department at the China Center for International Economic Exchanges based in Beijing.

He noted China’s property issues are tied to the education system’s problems. Parents anxious to send their children to top schools have bid up nearby housing prices — which local authorities such as those in Beijing have tried to push back on.

For Evergrande, residential real estate development remains one of its major businesses, but the company has climbed into the ranks of Fortune’s Global 500 list and expanded into industries such as film and entertainment, life insurance and spring water. Evergrande backs Guangzhou’s soccer team and has an electric car unit.

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LACKIE: Toronto besieged by tightest real estate market in recent memory – Toronto Sun

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Justin Trudeau’s Liberals desperately need to follow through on election campaign promise to address Canada’s housing (un)affordability crisis

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Well, fall has officially arrived.

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The election is over, the air is finally crisp, and the leaves are starting to turn. It feels like a new chapter is before us.

Following a relatively slow summer, the real estate market has reawakened, with buyers and their agents zooming from showing to showing, sellers and their agents prepping houses to bring to market, all while everyone else is doing their best to keep the calm.

Managing expectations while leaving room for the market to work its alchemy is pretty much the name of the game these days.

Even with the welcome surge of new activity, Toronto is still besieged by the tightest real estate market in recent memory. Active listings are at a 25-year low while demand, bolstered by record-low interest rates, remains fierce. These market conditions don’t bode well for those clinging to the hope that prices will come down any time soon.

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If anything, we are already seeing signs that the dramatic growth we have witnessed in the freehold market is now taking root in the condo market, the last front for would-be homeowners now priced out of proper houses in the 416 and 905. If you can’t afford a house in the city and your job requires you to show up to work in-person, your options are limited — one can understand the logic in taking advantage of the low rates while you can and buying what you can afford versus continuing to rent in an equally tight market with rents almost totally back to pre-pandemic levels.

  1. A real estate sign that reads

    LACKIE: Housing affordability crisis unlikely to improve any time soon

  2. We’re closing off a slow summer within the tightest real estate market in recent memory.

    LACKIE: Don’t fear a real-estate crash, but supply must improve

  3. Prime Minister Justin Trudeau delivers remarks at a press conference at a housing construction site in Brampton on July 19, 2021.

    LACKIE: Liberal housing plan feels disingenuous

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The good news is the election is now over and we may finally have some reprieve from the hollow discussions around how best to confront Canada’s housing (un)affordability crisis. With the Liberals now granted another four years to implement their election promises, it will be interesting to see how that shakes out given that a number of their proposals seemed awfully challenging to deliver.

Think you’re likely to see that Home Buyers’ Bill of Rights come into effect any time soon? Doubtful since it’s a federal policy and the real estate industry is regulated by the provinces. If blind bidding is going to be banned, and I honestly don’t see how it can, it’s going to take years of consultation in order to land on the process to stand in its place, and a regulatory system to enforce it.

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Instead, I would expect to see them to swiftly follow through on their promise to freeze foreign home purchases since that won’t take much more than the stroke of a pen. If so, I would also expect to see increased foreign buyer activity until such a time, particularly in the condo sector, which will, at least in the short term, drive demand and contribute to rising prices.

We apologize, but this video has failed to load.

The other aspect of the platform most experts anticipate will be coming will be the Liberal pledge to increase the cut-off for insured mortgages from $1M to $1.25M, effectively punching up buyers’ spending power. Forgetting for a moment that all that will functionally do is allow people to compete with one another for the same homes by spending more, which will in turn be yet another element driving demand, in the short term it may have some unintended consequences.

While some buyers may take a beat and wait for their spending power to increase, we might also see sellers do the same, which will further limit inventory and drive-up prices in the short term.

The reality is that Toronto is not unique — housing affordability in major cities is a global problem.

How best to address the crisis is an ongoing conversation happening in countries and cities all over the world. Canada is only just getting started.

@brynnlackie

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Real estate transfers Aug. 28-Sept. 3 – Massillon Independent

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Bethlehem Township

Freed Zachary Benjamin & Dianna Marie from Datkuliak Daniel L & Donald E & James W, 4696 Fohl St SW, $125,000. 

Freed Zachary Benjamin & Dianna Marie from Datkuliak Daniel L & Donald E & James W, 4720 Fohl St SW, $125,000. 

Fritz Travis W from Ames Jack W & Bonita L, 7853 Hudson Dr SW, $285,000. 

PSPR Properties LLC from Lee’s hunt’in Shackinc, 702 Main St N, $50,000. 

Skibicki Rolland & Pamela from Vancamp Judith C, 216 4th St NE, $125,000. 

Canal Fulton

Alspach John Jr & Carol from Schalmo Properties Inc, 930 Cabot Dr, $41,900. 

Hercheck Steven J from Klein Peter N, 555 Market St W, $92,500. 

Holderbaum Beth S from Fulton Landings Development LLC, 318 Alexis LN, $356,553. 

Mamj Properties LLC from Schalmo Properties Inc, parcel 10009478 Portage St NW, $150,000. 

Yeary Lisa M from Huntley Kristen E, 2044 Ellsworth Dr, $246,000. 

Jackson Township

Aces Real Estate Inc from Goodyear Bank, 4140 Portage St NW, $500,000. 

Aowad Ryan & Ashley from Staley James & Sherrie K, 8375 Audubon St NW, $320,000. 

Bajormas Joseph J & Mary Beth from Ridgeview Development Co Inc, parcel 1630311 Chermont St NW, $79,000. 

Biasella Matthew E & Ashley L from Tank Bradley D & Alexandra v, 7247 Bentham Cir NW, $345,500. 

Blackstock Stefan C & Denise M from Mckimm Lisa, 3316 Broadhaven Ave NW, $190,000. 

Bradshaw Timothy J & Karen C from Bagwell Eric M & Jill E, 8341 Blue Heron Cir NW, $530,000. 

Curtis Susan K from Aman James P & Denise J, 5949 Freitag St NW, $200,000. 

Curtis Susan K from Aman James P & Denise J, parcel 1602779 Libbie St NW, $200,000. 

Dale Sally M Trustee & from Braucher Daniel J Trustee, 7626 Wales Ave NW, $925,200. 

Dale Sally M Trustee from Dale Sally M Trustee &, 7626 Wales Ave NW, $925,200. 

Emley William W Sr & Christine A from Samsa Charles A, 2222 Duncannon Ave NW, $270,000. 

Gillespie Nicholas R from Chine Jeffrey L & Gillespie Pamela A, 7993 Oakdale St NW, $112,500. 

He Ying from Masidonski Lauren M, 3614 Barrington PL NW, $158,000. 

Hines Matthew Spencer from Divvy Homes Warehouse I LLC, 1266 Concord St NW, $100,000. 

Holmes Sonya A & James P from Waltman Carol E, 8273 Edmund Court Cir NW, $380,000. 

Impagliozza Donald J & Jane A from France Jerry G & Mareno Richard M II, 2245 Devonshire Dr NW, $299,900. 

Khan Saadat A & Karamat Anum from Rubin Barbara L & Dickson Pamela S Ttees, 4106 Lochness Cir NW, $525,000. 

Kibler Christopher & Carly from Vanderlind Gary S & Lisa A Trustees of T, 8663 Regency Dr NW, $675,000. 

King Lindsay A from Huston John E III, 8893 Traphagen St NW, $128,000. 

Lawrence Mark from Scassa Antonio R, 3508 Cardiff Ave NW, $220,000. 

Lemin Ian K & Sara L Ttees from Jane Zito Designs LLC, 7032 Emerson Cir NW, $830,022. 

Lindesmith Zachary Jeff & Jeff from Weaver Christ, 6674 Hills and Dales Rd NW, $110,000. 

Mellion Mark L & Amber L from Jain Kantilal N & Bhagwanti K, 3357 Hadrian Cir NW, $360,000. 

Miller Michael D from Minor Christopher S, 5947 Westlake BLVD NW, $165,000. 

Miller Michael D from Minor Christopher S, parcel 1604187 Sterling St NW, $165,000. 

Monaco Nathan A & Aimee B from Jane Zito Designs LLC, 7235 Greenview Ave NW, $872,873. 

Oakes Javin from Oakes Edward T., 7816 Daytona St NW, $185,000. 

Pachan Ben & Kate from Linton David K & Deborah L Trustees of T, 3328 Waterford Ave NW, $333,220. 

Parks Kyle & Mary from Petit Mark A & Lori J, 7680 Killeen St NW, $712,000. 

Romans David E & Dorinda M from Boch Robert C & Helen M, 8093 Winterwood Ave NW, $149,000. 

Roush Chad & Heather from Moore Johnathon & Jessica, 6685 Hillfield St NW, $195,900. 

Russell Daniel Thomas & Heather Armsey from Tonsky Thomas A & Beth A, 6735 Thicket St NW, $357,250. 

Sherer Steven D II & Linda Ann from Rodriguez Castillo Vanessa A & Rodas Man, 7403 Hawksfield Ave NW, $375,000. 

Smith David W & M Lynn Co-Trustees from Salter Bryce J, 6968 Knight St NW, $212,000. 

Tanda Construction LLC from Kelly Joseph, 5093 West BLVD NW, $140,000. 

Vail Capital Group LLC from Carlone Brian M & Lynn A, 6990 Hills and Dales Rd NW, $230,000. 

Vretas James & Kathryn from Cross Timberlands LLC, parcel 10012362 Nottinghill Cir NW, $370,000. 

Lawrence Township

Boak Marlesa Marie & Keith R from Madzia Cindy Sue & Bing Karen Elaine, 15021 Penford St NW, $150,000. 

Luther Michael & Aurora E from Lincoln Joseph W, 136 Thomas BLVD NW, $46,000. 

Mitchell Courtney & Seth from Ammond Timothy J & Jennifer A, 4795 Alabama Ave NW, $425,000. 

Tharp Eric Shane & Jenni Lynn from Tissot Chelsie, 15391 Orrville Rd NW, $210,000. 

Massillon

Aaron Corban J from Moyer Geraldine B, 869 Amherst Rd NE, $60,000. 

Arnold N Brewer Associates LLC from Praxis Properties LLC, 2212 Courtland Ave NW, $66,000. 

Bourquin Nichole from Harwig Marc A, 142 Penn Ave SE, $32,500. 

Brinkley Property Group LLC from Hercules Holding Collc, 2770 Erie St S, $935,000. 

Dicicoo Joseph & Kelsey from Braneky Stephen L &Frieda J, 2536 Valleywood Ave NE, $273,750. 

Glick Josiah W from Spencer Kathleen D, 1334 3rd St SE, $30,003. 

JJ Canton Rentals LLC from Schnabel Investments LLC, 517 8th St SW, $440,000. 

Jones Lemuel T & Connie S from Jre Homes LLC, 1801 Forest Ave SE, $79,900. 

Layth & Ayah Properties LLC from Meinhart Patricia A, 2005 Clearview Dr NE, $140,000. 

Loudiana Michael J from Gorcoff Dennis M & Susan J, 1488 Pebble Chase Cir NE, $189,000. 

Mccoy Todd A from Diacontonas Zachary M, 146 25th St NW, $129,000. 

Miller David P & Dream G from Mccleary Ladonna & Boyd Beth, 325 12th St SW, $109,900. 

Mullet Merle & Lena from Guilliams Ashley L, 805 32nd St NW, $118,000. 

Reality Renovations LLC from Green Mountain Holdings Cayman Ltd, 1161 Bradford Rd NE, $210,000. 

Rey Timothy C from Mishler Kelly J, 475 27th St NW, $141,500. 

Ruth Jeremy G from Lec Investments LLC, 1117 Tremont Ave SE, $45,000. 

Salopek Anthony from Highben Edward A Jr & Carolynnanne M, 667 Young Ave SE, $23,500. 

Salopek Anthony from Highben Edward A Jr & Carolynnanne M, parcel 608343 Young St SE, $23,500. 

Schilling Birchard L from Hoffner Christopher T, 1420 Forest Ave SE, $84,900. 

Perry Township

Baker Anthony S from Riley Homes LLC & Exteriors Plus LLC, 3163 List St NW, $200,000. 

Baltzly Andreas from Douglass Jason P & Macy D, 1021 Market St NE, $159,900. 

Burke Michael W & Marcoguiseppe from NVR Inc D/B/A Ryan Homes, 6985 Gauntlet St SW, $240,175. 

Davis Rebecca J & Robert M from Daugherty Karen S, 5514 Perry Hills Dr SW, $200,000. 

Dennis James A from Dennis James A & Robert L, 3232 Rayanna St NW, $40,000. 

Duffy Taylor Brooke & from Strock Kelly, 4908 14th St SW, $130,000. 

Foradas Alyssa & Mcmullin Corey from Rescomm Property Investments LLC, 3985 Greenford Ave SW, $180,000. 

Garrett Raquel L from Warth Michael J, 321 Elmford Ave SW, $103,675. 

Gess Emanuel from Belliveau Matthew & Kristina, 1500 Jackson Ave NW, $210,000. 

J & K Rental Management LLC from Bowlus Realty Ltd, 1733 Perry Dr SW, $265,000. 

JJ Canton Rentals LLC from Schnabel Robert R Jr Trustee / Robert R, 5401 Richville Dr SW, $184,000. 

Kaminski Cassidy M from Murray Tina M, 515 Highland Ave SW, $144,900. 

Kubiak Michael C IV from Sampsel Lindsey D, 4909 Lynncrest St SW, $130,000. 

Laney Joshua C & Mast Sydney R from Laney Charles J Ttee, 2524 Nottingham St NW, $201,000. 

Loudon Nathan A & Erica from NVR Inc D/B/A Ryan Homes, 6128 Lavenham Rd SW, $270,125. 

Lynch 3125 LLC from Braun Stuart R, 3125 Lynch St SW, $80,000. 

Nations Lending Corporation from Long Joseph S, 4742 17th St NW, $80,000. 

Nations Lending Corporation from Long Joseph S, parcel 4301227 Woodlawn Ave NW, $80,000. 

NVR Inc A Virginia Corporation DBA from Dehoff Agency Inc, 6109 Lavenham Rd SW, $60,000. 

NVR Inc D/B/A Ryan Homes from R L Deville Holdings Ltd, 6913 Gauntlet St SW, $47,895. 

Piatko Jeffery A from Rohleder Ryan A & Alicia, 5387 Aquarius St SW, $205,000. 

PNC Bank National Association from RCK Properties LLC, 5240 Emil Ave SW Unit 102, $26,000. 

Slutz Jacob from Schnabel Luke C & Kaley, 5525 Richville Dr SW, $225,000. 

Smith Cole Jason from Hirschman Julie S, 1215 Delverne Ave SW, $139,900. 

Swisher Jerry L & Susan L from File Lila, 319 Zern Ave SW, $72,000. 

Walker Lisa Marie from Flagg Michael R & Annmarie L, 3751 Mollane St NW, $185,000. 

Sugarcreek Township

Garvin Jewell L from Garvin Wesley J & Jewell L, 5877 Smith Rd SW, $195,000. 

Hershberger Aden S & Clara N from Grady Jack C & Shell Deborah H, 14909 Wynncrest St SW, $310,000. 

Mast Benjamin M from Miller Milo J, parcel 6700326 Navarre Rd SW, $677,000. 

Miller Kobe A & Brittany A from Hershberger Nancy L, 805 West CT, $178,500. 

Zeigler Tamara L from Brewster Estates LLC, 460 First St SW Lot #64, $6,000. 

Tuscarawas Township

Neitz Nicholas from Romar Chris P & George P, 923 Highlander St NW, $72,500. 

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BCREA Education Programs Win 2021 ARELLO Awards – British Columbia Real Estate Association – BCREA

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BCREA Education Programs Win 2021 ARELLO Awards – British Columbia Real Estate Association  BCREA



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