Country Garden sales drop 72% as China’s housing woes persist

(Bloomberg) — Country Garden Holdings Co.’s sales slump dragged on last month, adding to the Chinese developer’s woes as it tries to avoid liquidation.

Contracted sales for July dropped 72% from a year earlier to 3.41 billion yuan ($478 million), following a 73% slide in June, corporate filings show. The tally was 21% lower from the previous month.

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The distressed real estate giant is counting on a turnaround in sales to increase its survival chances, as it fights a wind-up petition in a Hong Kong court following its 2023 default. Last week, it was given more time to work on an offshore debt restructuring plan when the case was adjourned to January.

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“Buyer concerns around Country Garden’s liquidity means they are likely to avoid its projects until fully completed,” Bloomberg Intelligence analyst Kristy Hung wrote in a note on Aug. 1.

Country Garden’s month-on-month decline in home sales is smaller than the 36% slide at the 100 biggest real estate companies tracked by China Real Estate Information Corp.

A recent rescue package has failed to revive China’s housing market, which remains a major drag on economic growth. New-home prices dropped at close to the fastest pace in almost a decade in June, giving people less reason to invest in property.

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