China’s real estate market continues to be in a slump, causing more and more families to struggle with mortgage pressures and insurmountable debts. Recent reports from various self-media bloggers and private monitoring reveal that potentially millions of households across the country are facing situations of defaulting on loans or being forced into foreclosure. However, the lack of transparency in official data has sparked concerns in society about economic risks and livelihood pressures.
In Mainland China, there has never been a consistent and publicly disclosed system for regular statistics on foreclosed properties established by the Chinese Communist Party. The data often cited by self-media sources comes from third-party institutions or auction platforms. Due to the increased attention on foreclosed properties in recent years, monitoring and publication by third-party organizations have become more frequent.
Prominent financial blogger “Weihu Talks Real Estate” recently mentioned in a video that based on data from the Chinese State Administration of Financial Regulation and the central bank, the number of individuals nationwide who have failed to repay their mortgages for three consecutive months, reaching the standard for default, has reached a staggering 1.87 million, representing a 35.6% increase compared to 2024.
In addition to defaults and foreclosures, many banks have implemented temporary repayment solutions for some borrowers, such as deferring principal repayment, interest-only payments, or staggered repayments. “Weihu Talks Real Estate” noted that the number of mortgage defaulters has increased by over 35% since last year, reaching approximately 1.87 million households, while borrowers negotiating delayed payments or temporary repayment pauses with banks have reached 2 million households. When combined with around 2 million properties already in foreclosure procedures, the total number of affected households nationwide may exceed 6 million, indicating that over 6 million families are facing a crisis with their mortgages or are already in a debt-trap situation.
The blogger analyzed, stating, “This means that at least one-eighth of mortgage households in China are experiencing cash flow difficulties.” Furthermore, he warned that if the economic and employment situations do not significantly improve in the next three years, these borrowers who have postponed repayments are likely to eventually default.
According to statistics from some private monitoring platforms, foreclosed properties in major cities are still high, with many properties being sold at a discount of up to “30% below market value.” This not only increases market supply but also further disrupts the property price system.
With 277,000 followers, current affairs blogger “Brother Dog” delves into the social aspect, pointing out that behind this mortgage crisis is the collective manifestation of the “financial fragility” of ordinary Chinese families. This “financial fragility” reflects structural issues in the Chinese economy: the job market is mainly dominated by short-term, low-security employment, and inadequate savings and financial safety nets for residents, making it easier for macroeconomic fluctuations to transmit to the individual level.
He cited an official report on economic risks in China that two years ago, there were 200 million “flexibly employed” individuals, with over half belonging to the “financially fragile” group. This official term “financial fragility” sparked heated discussions among netizens, translating into a colloquial understanding that 200 million people in China are unemployed, half of whom have no savings. Once they lose their jobs or experience income disruptions, they are susceptible to falling into debt traps.
“Brother Dog” stated that two years ago, China had 200 million people without formal employment and limited savings, with the majority being middle-class. With the wave of layoffs and unemployment over the past two years, the middle class is facing unemployment, and their properties, now devalued due to plummeting house prices, have become liabilities. Both the middle class and the general public are struggling to cope, but how long can they hold on? When they can no longer sustain themselves, unable to afford food or their children’s education fees, what will they do? They will have no choice but to default on their loans.
“People were not aware of the true scale of the economic crisis two years ago, and now more and more ordinary people are beginning to mock themselves as ‘financially fragile,’ which itself deepens the crisis,” he emphasized.
He pointed out that compared to the privileged class, the economic impact ultimately falls on ordinary families. “Each crisis is a process of wealth redistribution— the rich get richer, and the poor get poorer.”
The issue of Chinese mortgage problems is not just a crisis in the real estate market but a microcosm of structural economic issues. As businesses close, the job market weakens, and incomes decline, residents’ debt-repayment capabilities are generally decreasing. With property prices continuing to fall, assets shrinking, and credit confidence diminishing, a vicious cycle of “falling house prices—tightening credit—shrinking consumption—slowing economy” is forming.
Analysis indicates that when individuals cannot repay their loans, properties are foreclosed, and asset values evaporate, the financial system will face a chain reaction. While banks’ risks may not be immediately apparent in the short term, as the wave of defaults spreads, financial pressures will gradually transmit, impacting economic stability.
Regarding the official statistics decreasing and being perceived as “distorted” externally, against the backdrop of low confidence in the real estate market, the economic pressures on ordinary families are becoming the most sensitive social issue in China. From the “wave of defaults” to “financial fragility,” this mortgage crisis primarily affecting the middle class not only reflects the imbalance between assets and liabilities but also reveals the fragility of ordinary people’s safety nets. As a widely shared saying online goes, “Data may not be disclosed, but anxiety cannot be hidden.”