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China's real estate market is all over the news for all the wrong reasons. It all started with Chinese real estate biggie Evergrande racking up a debt that drowned its penthouse, while leaving its investors high and dry. But amid all that gloom, here's some great news from Harbin - the capital of northeastern Heilongjiang province.
Harbin is now one of the first cities in China to specifically support real estate developers and their projects, which have been hit hard by the deepening debt crisis at the China Evergrande Group.
The city feels that builders should get back part of their presale funds held in government escrow accounts as quickly as possible to ease some of their cashflow pressure.
What's more is that as critical cash flow improves, developers with good credit profiles are being encouraged to re-start presales of their projects as soon as they are ready to.
China's real estate market has been witnessing declining sales and investments lately, while increasing unsold inventory is inhibiting growth in new home prices, despite builders offering deep discounts.
Yan Yuejin, director of Shanghai-based E-house China Research and Development Institution, said he expected other cities to follow Harbin in announcing support for the sector, especially "those under great pressure from high inventories, including some tier-three and four cities in central and western regions."
Zooming Out
Zooming Out
Morgan Stanley recently lifted its outlook on China's real estate industry to "attractive" from "in-line", anticipating that regulators could ease their grip on the sector to help stabilise it and support the economy.
This has enabled the country's stressing real estate developers to finally breathe a small sigh of relief.