China to almost double support for unfinished housing projects

BEIJING

China said on Thursday it would boost credit available for unfinished housing projects to more than $500 billion as it unveiled another round of measures to shore up the sector and try to reignite the economy.

The real-estate sector has long accounted for around a quarter of gross domestic product and experienced dazzling growth for two decades but a years-long housing slump has battered growth as authorities eye a target of around five percent for 2024.

At a briefing, Housing Minister Ni Hong offered fresh help, saying Beijing will "increase the credit scale of white-list projects to four trillion" yuan ($562 billion) by the end of the year, up from more than two trillion.

The "white list" scheme, announced earlier this year, pushes local authorities to recommend housing projects for financial support and work with banks to ensure their completion.

China's leadership last month warned the economy was being plagued by "new problems" as officials unveiled a raft of stimulus in one of the biggest drives to boost growth for years.

Among the measures were a string of interest rate cuts, the loosening of restrictions on home-buying and moves to free up cash for banks to lend more.

on Thursday, Beijing said it estimated that "existing mortgage rates will fall by an average of about 0.5 percentage points" under those cuts.

That, central bank deputy governor Tao Ling said, would "save 150 billion yuan in interest expenditure overall, benefitting 50 million families and 150 million residents."

The latest announcement comes as China prepares to release third-quarter growth data today, which is forecast to be the slowest this year.