China is reportedly considering a new stimulus package for its struggling real estate sector, a mammoth industry that if weakened further could threaten the country’s financial stability.
Officials in Beijing are for the first time considering options such as mortgage subsidies and lowering home transaction costs to reverse the sector’s years-long slump.
While Chinese investors have gradually reduced their exposure to real estate, a huge share of the country’s wealth remains tied up in property that is fast losing value.
Despite Beijing’s intervention, “the real estate market downturn will continue for some time,” a former Chinese finance minister said, calling on authorities to keep fiscal policy loose to defend the world’s second-biggest economy from a property crash, Caixin reported.
