Senor Bloombergo with the report.
Among Xi’s signature policies, the most significant has been his crackdown on the housing sector, which kick-started in late 2020 with tighter scrutiny over the debt of developers. In the last two years, existing home prices in more than half of tier-2 and tier-3 cities have fallen by at least 15% from their peak.
The property sector was taking up too much capital. As of 2018, real estate investments accounted for almost 20% of China’s gross domestic product, but only employed 2% of the workforce, according to Bloomberg Economics estimates. Most of the 16 million working in the industry were poorly paid migrants, laboring long hours on construction sites, while top management morphed into billionaires. In 2017, China Evergrande Group’s founder Hui Ka Yan, now under criminal investigation after his company’s spectacular defaults on its dollar bonds in 2021, became the country’s richest man. At the 2019 peak, of the 500 billionaires tracked by Bloomberg, close to 20% were real estate tycoon.
