Developer China Vanke reports US$2.3 billion loss amid sales slowdown
Persistent property-market weakness ratchets up pressure on the developer despite increased support from its largest state-owned shareholder
Developer China Vanke reported a deeper third-quarter loss, highlighting mounting challenges as the prolonged property market downturn continues to weigh on its sales.
The Shenzhen-based company posted a loss of 16.1 billion yuan (US$2.3 billion) in the three months ended September 30, roughly doubling its loss from a year earlier. That brings its combined losses for the first nine months of the year to 28 billion yuan, according to a statement to the Shenzhen exchange on Thursday.
Persistent weakness in China’s housing market is creating pressure on the developer’s bottom line, despite increased financial support from its largest state-owned shareholder, Shenzhen Metro Group. The company’s financial position remains vulnerable as it deals with a wall of onshore debt maturities.
The country’s home sales deteriorated further in July, and new-home prices fell at an accelerated pace. The price slump is deterring homebuyers who are increasingly concerned about the viability of buying real estate as a store of wealth.