China’s housing market isn’t doing too hot

China is reportedly considering a new rule that would allow homeowners to temporarily halt mortgage payments, as thousands of disgruntled buyers have staged a boycott across the country.

🤔 What’s going on?... In China, real estate firms are allowed to sell homes before completing them, meaning customers have to begin mortgage repayments before they actually possess the new property. Developers typically use these funds to finance construction of the new homes.

• A growing number of real-estate projects have been delayed or stalled in recent years due to a lack of cash among Chinese developers, most notably property giant Evergrande.
• In response, many buyers have stopped paying mortgages on homes that aren’t being built, impacting at least 230 projects across 80 Chinese cities as of Friday. Stalled projects account for $296 billion in mortgage payments, all told.

✋ But wait, there’s more: Finance-related protesting in China appears to be all the rage. In addition to mortgage boycotts, residents of the Henan province have staged mass demonstrations since May over the country’s biggest-ever bank scam.

• Authorities arrested several suspects and froze customers’ deposits at five rural banks in April after accusing their private shareholders of siphoning off several billion dollars in funds by falsifying loans and data reporting.
• Last week, Chinese regulators promised to repay affected customers with deposits of up to ~$7,500.