China's September land sales revenue dips, hindering recovery

In September, China's government land sales revenue experienced its 21st consecutive monthly decline, exacerbating the challenges faced by local authorities grappling with increasing debt obligations, as per data released by the finance ministry on Tuesday.

Based on the ministry's figures, land sales revenue in September dropped by 21.3 per cent compared to the same month last year, following a 22.2 per cent decline in the preceding month, according to calculations by Reuters.

Land sales plummet

For the period spanning January to September, land sales revenue was down by 19.8 per cent year-on-year, amounting to 3.0875 trillion yuan ($422.42 billion). The continued slump in land sales, a critical gauge of the property market's vitality and local fiscal health, can be attributed to the lackluster real estate market characterised by declining home prices, reduced property transactions, and subdued investment.

In an effort to rejuvenate the sector, authorities have recently introduced a series of measures, with some top-tier cities exhibiting early indications of recovery. However, these policies have only had a modest impact on market sentiment, leaving investors hungry for more extensive policy backing.

Beijing has also intensified its oversight of financing vehicles employed by local governments. In response, cities have rushed to issue bonds to manage their debt repayment obligations, as mounting debt has become a significant threat to economic stability.

(With Reuters Inputs)