A Chinese government-supported property project received the first development loan amounting to 330 million yuan ($46 million) shortly after the government introduced the project whitelist mechanism, as reported by Reuters on Wednesday, citing the official Securities Times.
This mechanism requires city governments to compile a list of local property projects eligible for financial support and collaborate with local financial institutions to fulfil the financing requirements of these projects.
Securities Times reported that Nanning city in the Guangxi region has shared its inaugural project whitelist with local financial companies, featuring 107 developments.
China Mingsheng Banking Corp. granted a development loan to a project by the state-supported Guangxi Beitou Industry and City Investment Group.
Additionally, the southwestern city of Chongqing has produced a whitelist of 314 projects, requiring a total financing of 83 billion yuan, as stated by the city’s housing authorities on their official Wechat account.
The initial whitelist includes projects from private developers Longfor Group and Huayu Group and state-supported China Vanke, all considered financially healthy by the market.
The market, still recovering from a debt crisis since mid-2021 that led to unfinished homes and defaults, particularly among private developers, is closely monitoring this funding support rollout.
Analysts predict a lengthy period before the property market stabilises.
They also suggest that the liquidation of property titan China Evergrande Group by a Hong Kong court could further dampen demand as homebuyers exercise caution due to uncertainties surrounding the stability of other private developers.
