Published on 11 Aug 2022 on Insider Monkey via Yahoo Finance
‘Caught in the Middle’: China’s Mortgage Crisis and 10 Stocks to Watch
In this article, we discuss China’s mortgage crisis and 10 stocks to watch. If you want to check out more stocks to monitor in this situation, click 5 Stocks to Watch Amid China’s Mortgage Crisis.
Chinese banks are in the midst of mortgage losses amounting to $350 billion as the property and real estate market plummets and authorities grapple to control the mess. The Chinese mortgage crisis is a result of delayed housing projects by the China Evergrande Group, that have eroded the confidence of thousands of homebuyers, which led to people boycotting mortgage payments in more than 90 cities amid widespread protests. The Chinese authorities, in a bid to control public outrage, started monitoring protests and policing the people, as well as shutting down online communities where users shared their candid views regarding the housing debacle.
It is yet to be determined how the $56 trillion banking sector in the People’s Republic of China will be impacted by this crisis. According to S&P Global Ratings, about $356 billion, or 2.4 trillion yuan, which comprises 6.4% of total mortgages, are at risk. Deutsche Bank AG, on the other hand, warned that at least 7% of housing loans are in danger of default as homebuyers threaten to boycott payments.