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China’s Ministry of Housing and Urban-Rural Development, Ministry of Finance and People’s Bank of China (PBOC) have been planning to provide support to the stalled constructions of residential property projects by offering special loans to developers via policy banks, according to a report by state broadcaster CCTV earlier this month, which didn’t disclos the size and other details.
The lending program represents China’s biggest financial commitment yet to address a property crisis that battered the country’s real estate market.
Chinese news outlet Caixin reported on Monday that special loans with an initial scale of up to 200 billion yuan will be issued by China Development Bank and Agricultural Development Bank of China and added to the existing loan quotas under the guidance of PBOC, with the Export–Import Bank of China potentially joining in at a latter stage of the scheme.
The authority has made it clear that the 200 billion yuan loan “will not be used to stimulate the real estate market nor rescue real estate companies” and the use of the funding is strictly restricted to construction and delivery of stalled residential property projects, according to the report.
Last week Bloomberg News had reported that Beijing was set to offer 200 billion yuan in special loans to finish stalled housing projects in China.
Since late June, the mortgage crisis led to nationwide boycotts in China after hundreds of thousands of homeowners made advance payments and took out loans on properties that insolvent developers failed to complete.