The number of Chinese homebuyers boycotting their mortgage repayments in protest of unfinished buildings has spread to more than 300 locations across the country, according to a GitHub page documenting the action, the media reported.
Mortgage boycotts are being organised by buyers of property in 12 unfinished projects in the southwestern megacity of Chongqing, seven in Shanghai, eight in Guangdong province, nine in Nanning and 10 in Taiyuan, with hundreds of other locations reported throughout China, reports posted by homebuyers to the WeNeedHome GitHub page showed.
Buyers have been left high and dry after buying apartments off-plan, or before completion, only to find that developers have downed tools and abandoned half-finished buildings they once hoped to call home, or use as an investment, RFA reported,
Now, they are increasingly banding together and issuing “mortgage repayment suspension notices” to lenders, with both sides calling on the government to act in their favour.
“In an attempt to keep payments going, buyers made repeated trips to the relevant government departments and agencies in charge to request assistance and to stand up for our rights,” a statement issued by buyers of apartments in an unfinished complex in Dalian’s Lushunkou district wrote.
“But there seems to be no sign that work will ever start again on the development,” it said.
Another statement from buyers in Hantou county, Changde city says: “We have been forced to stop mortgage payments due to the huge losses sustained by the majority of buyers.”
Meanwhile, a statement from buyers in the northern city of Taiyuan accuses banks of fuelling the crisis by illegally transferring loans to developers, refuses to issue any more monthly repayments until the buildings are finished, and calls for an end to “punishments” handed down to buyers who take such action, RFA reported.
Xie Tian, a professor of business studies at the University of South Carolina, said the movement could have a serious impact on the Chinese economy.
“The suspension of mortgage repayments can lead to systemic financial problems… because of the large sums of money involved,” Xie told RFA. “Also, these are middle-class people with money and assets.”