Ms. Xu has lived in a room in a high-rise condominium in the southern Chinese metropolis of Guilin for the past six months. She purchased the apartment three years ago after being drawn to it by advertisements praising the riverfront views as well as the city’s pure air.
Her living circumstances, however, fall far short of what was promised: there is no running water or gas, and the walls are not painted. She walks up and down multiple flights of stairs each day while toting heavy water jugs outdoors that have been filled with a hose.
Xu, 55, spoke from the Xiulan County Mansion complex; her room was sparsely furnished with only a bed wrapped in a mosquito net, a few basics, and empty bottles on the floor. She asked to remain anonymous because the subject was so delicate.
Xu and around 20 other buyers use a temporary outdoor bathroom in the Xiulan County Mansion, and they congregate there during the day at tables and benches in the centre courtyard area.
They are a part of a wave of home buyers in China who have relocated into what they label “rotting” apartments either to put pressure on developers and authorities to finish them or out of necessity due to the severe real estate slump in the nation.
A July estimate from the Shanghai E-House Real Estate Research Institute, stalled projects made up 2.31 million square metres, or 3.85%, of the country’s housing market in the first half of 2022.
While some local authorities have established rescue funds to support the real estate industry, purchasers like Xu who already paid deposits and are responsible for mortgages are still waiting for action.
Social media has fueled an unprecedented wave of collective disobedience brought on by the growth of unfinished flats. In late June, thousands of homebuyers in at least 100 cities vowed to stop making mortgage payments in protest of the construction’s standstill.
According to Yan Yuejin, director of research of Shanghai E-House, 90% of new homes acquired in China are bought “off plans” while still being built, making the broader real estate market extremely susceptible to incidents of unfinished flats.
He also said, if this situation is not fixed, it will have an impact on real estate transactions, and the confidence of the government, and it might make the developers’ debt difficulties worse.
The world’s second-largest economy is suffering from China’s severe property collapse and the repercussions of stringent anti-COVID regulations at a time when the ruling Communist Party is preparing for its once-every-five-years Congress, scheduled next month.
Approximately a year after Jiadengbao Real Estate began building and began advertising apartments for about 6,000 yuan (or $851) per square metre, which they claimed would come with amenities like floor heating and a communal swimming pool, Xu purchased her two-bedroom, 70 square metre unit.
Initially, construction moved fast as blocks in the intended 34-tower complex rose one after another.
However, Jiadengbao Real Estate made news in June 2020 after a court seized 340 million yuan worth of its assets, including several apartments in Xiulan County Mansion, and accused its parent business of conducting unlawful fund-raising.
After learning that construction had ceased in the middle of 2020, Xu experienced what she later called a “crashing from paradise” feeling.
A request for comment was not answered by the most-sought Jiadengbao Real Estate.
Thousands more homeowners have been put in a similar situation since the debt crisis began in 2021 as cash-strapped developers filed for bankruptcy or abandoned failing projects.
Housing officials in Baoding, the impacted northern city wherein Jiadengbao Real Estate’s parent firm is registered, reported that a panel to handle the problem had been established last November by the municipal government as well as the Communist Party committee.
The populace promises to return home if the government is sincere about safeguarding livelihoods and starting construction once more.
