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2026-09-04 11:10:26 The Chinese government announced concerted reforms for real estate-related industries, fundamentally overhauling the regulatory framework that has been in place for more than two decades, Moody's said. The policy package tightens pre-sale requirements, strengthens supervision of pre-sale funds, promotes completed-home sales, extends the tenor of mortgages and development loans, delays mortgage disbursement until property completion, and introduces lead bank arrangements as well as broader capital market financing channels. Moody's expects this to have profound and long-term implications for the property market and its key participants - developers, financial institutions, local governments and homebuyers. Over the next 12-18 months, the transition period will bring costs and increase financing pressure, with uneven impacts across sectors, while weaker developers and local governments reliant on land finance will face the greatest pressure. However, after 2-3 years, these reforms will generally be credit positive as they institutionalize a lower-leverage, delivery-focused property model. As delivery risks decline and financing becomes more aligned with project completion progress, homebuyers, banks and the broader market will benefit. However, as the policy package represents structural reform rather than cyclical stimulus measures, its direct support for near-term property sales and economic growth will likely be limited. ~ AASTOCKS Financial News Website: www.aastocks.com | |