The crisis in the real estate sector had led to crippling levels of debt, private and public, and left domestic demand in limbo.

The real estate sector has not yet recovered from the crisis of 2021. Residential inventory amounts to USD 13 trillion or eight times the value of homes sold in the country in 2023 (Goldman Sachs estimates).

Household debt-to-GDP went from 20% in 2008 to 60% in 2023. Officially, the 2025 budget deficit should reach 4% of GDP, but
according to the IMF, could exceed 13%. Local governments have a hidden debt of $ 1.99 trillion (Finance Minister Lan Fo’an).

Youth unemployment is high (~16%) even among the highly educated. The RE crisis has led to depleted private savings. Government stimulus measures mainly benefit industries. China is growing older, and its population is projected to shrink by 62% to 525 million by 2100.