As China’s major commercial banks accelerate the disposal of existing mortgage properties, a large number of “bank direct supply houses” are being centralized in the market through online platforms. However, these seemingly “low-price clearance” properties have not sparked a buying frenzy. On the property section of JD.com platform, over 9,000 properties have entered the second auction stage, indicating that they received no interest during the first auction.
With the Chinese real estate market entering a deep downturn, risks associated with some developers and individual loans are being exposed at an accelerated pace. In order to mitigate their own risks and shorten the disposal cycle of non-performing assets, several large commercial banks including Agricultural Bank of China, Construction Bank, and Bank of Communications have been speeding up the bulk disposal of their inventory of mortgage properties.
Different from traditional court auctioned properties (judicial auction properties), these “bank direct supply houses” or “mortgage properties” are directly entering the market through online asset trading platforms such as JD.com and Alibaba. Initially, the market expected that these “bank direct supply houses” would attract buyers with their “low-price clearance” strategy. However, data from online auction platforms shows that a significant number of properties have failed to attract buyers.
In the “financial assets” section of JD.com’s asset trading platform, over 9,000 properties have entered the second auction stage, indicating that they remain unsold after the initial auction.
Reported by the “First Financial Daily,” taking an example of a property from Ningxia Yellow River Rural Commercial Bank in Xingqing District, Yinchuan City, the initial auction price of 620,000 Yuan dropped to 558,600 Yuan in the second auction after no bidders showed interest during the first auction.
Some banks are adjusting their sales strategies even after properties fail to sell at auction. Currently, Lanzhou Rural Commercial Bank has removed the sales information for individual houses in a small community on JD.com’s asset platform. Instead, they have released a comprehensive investment promotion notice for the “Y…