#1. Out of House and Home
Many across China are refusing to pay their mortgages for apartments that they’ve never seen – and likely never will. In China it’s common to buy a home before it’s built, and many firms will use these prepayments to finance their construction.
However, developers across China have recently defaulted, triggering a widespread pause to construction. Buyers are paying mortgages for non-existent homes, and many are concerned they won’t ever be completed.
One developer, Kaisa Group, halted construction after just three months as they could no longer afford labour and supplies. These homes have become lanweilou – one of many construction projects left abandoned across China.
Now, this isn’t a new phenomenon in China, that is, construction grinding to a stop. However, it marks the first time people in China have refused to pay their mortgages. So far, 319 projects across 93 cities have been frozen, with an estimated 13 million apartments affected during the past year, according to Capital Economics.
On Douyin, China’s version of TikTok, homebuyers have been posting videos airing their grievances, with one particular user citing how they had put 70% of their salary towards a loan – a loan for an apartment still unfinished.
Readers of the YA newsletter may have seen a previous article of ours from May about Evergrande, a company who defaulted in 2021. Many more companies have since followed suite, due to which we now find ourselves in this current predicament.
From an economics perspective: it’s concerning for banks. Regulators have limited the amount of debt developers can undertake trying to mitigate risk. While the government is imploring banks to keep lending to developers, it has also issued a mortgage freeze to appease boycotting borrowers. It has been calculated that 1.8 – 2 trillion yuan worth of mortgages have been affected in China so far, and if the boycotts spread, and the value of mortgages affected increases, it could spell trouble for smaller banks.
It begs the question – what’s the solution to all this? This will depend on how the companies such as Kaisa Group respond, and whether those boycotting continue to do so.
#2. Century-old Chinese railway station offers perfect blend of modernity and nature following two years’ renovation
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The Jiaxing Station in Zhejiang Province, China, recently underwent two years of renovations as part of a larger project to build an underground terminal building. The finished product now boasts the name Train Station in the Forest.
Train Station in the Forest is a modern adaptation of the Jiaxing Railway Station, which was originally constructed in 1907, and takes into account elements like integration with nature. The project was fully reopened in early July amid excited crowds and cameras.
Located in the heart of Jiaxing, a hub in Southeast China connecting Shanghai, Hangzhou and Suzhou, the redesigned station sits largely beneath ground. A pair of sunken concourses illuminate the sides of the surface-level platforms through skylights and glass curtain walls.
The futuristic station, which represents a long-anticipated replacement for its crowded and ageing predecessor, gleams white with its polished engineered stone, and it features three platforms which service six tracks. It can serve more than 5 million people annually and accommodate 2300 people per hour during peak times.
While the increased capacity offers a very-welcome upgrade to Jiaxing's transit infrastructure, this isn't what's made the station a social media sensation. The solar panel-topped station is intriguing in and of itself, and it constitutes just one component of a major design that has turned the 350,000-square-metre site into an urban oasis that many visitors tote as the perfect backdrop for beautiful photos.
All of the station's transportation and commercial functions are hidden within the basement level, unlocking greater ground-floor capacity from obstructive amenities, all in the aim of seamlessly integrating the new landscape with the existing park. Achieving not only a return to nature, this move also enables retail space, indoor events and gatherings such as music festivals and night markets.
#3. Call for NZ’s Emerging Leaders
If you are under the age of 35, have an interest in the New Zealand-China space and see leadership potential in yourself, this event is not to be missed! Future Taniwha: Opportunities for NZ’s emerging leaders to engage on China is jointly held by The New Zealand China Council, North Asia Centre of Asia-Pacific Excellence ( NA CAPE), New Zealand China Trade Association Young Associates and the Asia New Zealand Foundation on Thursday 4th August. Come hear from former PM Sir John Key, as well as representatives from the four co-hosting organisations, to learn about the issues, challenges and opportunities facing the NZ-China relationship. Find out more and register here.
#4. Join the YA! We’re recruiting!
It’s an exciting month for the YA - we’re growing the team!
We’ve got some great events on offer this year that include John Key and another high-profile politician (keep your eyes peeled!) to come! As such, we’re getting more hands on board to help make sure the YA is putting its best foot forward with events and Patreon-exclusive content!
If you’re interested in checking out our openings and joining the team, take a look at the roles here!
We have vacancies up for grabs in the following teams:
- Operations
- Marketing
- Technology
- Treasurer
Also available roles such as Data Analyst & Coordinator, Business & Development Manager, Digital Content Creator and many more!
We’re a close-knit team, and while already possessing the relevant skills is great, we’re always providing opportunities to executives for training and professional development where needed! Come join the YA!