Two major global credit rating agencies have significantly lowered their forecasts for China's real estate sales

According to Bloomberg, S&P Global Ratings expects China's residential sales to fall 15% this year, a larger drop than the previous forecast of 5%. The rating company said on Thursday (June 20, 2024) that sales will be less than 10 trillion yuan (S$1.86 trillion), about half of the peak in 2021.

Another rating agency, Fitch, also lowered its annual sales forecast for China's real estate on Wednesday (19th) to a decrease of 15% to 20%, from the previous expected decrease of 5% to 10%.

The rating companies' downgrades show that they are not confident that recent stimulus measures can end the downturn in the property market. These agencies blame the unexpected drop in house prices, which has deterred home buyers.