Chinese property turns negative equity black hole

Wednesday 8 April 2026

The Chinese property market had a better week after a terrible start to the year.

The downturn has been running for nearly five years. In any market economy, we would be a long way through processing into just any glut of property, but the bad loans hobble the banking system.

But not in China. Measures to slow the decline in prices, plus other supports, have meant that negative equity has spread slowly.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.