BEIJING/HONG KONG - The number of foreclosed homes in China rose 43 per cent year on year in 2023, according to a private survey on Jan 22, highlighting a worrying trend of rising mortgage delinquencies amid a sustained property market slump and a patchy economic recovery.

The number of foreclosed homes up for auction stood at 389,000 units in 2023, said China Index Academy, a major independent real estate research firm. A total of 99,000 units worth a combined 150 billion yuan (S$28.3 billion) were successfully sold at auctions, the firm said.

Total foreclosures, including commercial, residential and industrial properties, land, garages and parking spaces, totalled 796,000 units, a record high. The number was up 36.7 per cent from 2022, showed the survey.

In 2023, the troubled property market saw the worst decline in new home prices in nearly nine years, dragging on the broader recovery.

China’s economy grew 5.2 per cent in 2023, as credit has been diverted from the property sector towards manufacturers and as investment into infrastructure held up.

The south-western second-tier cities of Chongqing and Chengdu were the most affected by home foreclosures, logging in the most auctions in 2023, China Index Academy said.

The number of foreclosures has been gradually rising since 2020, the firm said, and the number has continued to rise in the early days of 2024.

E-commerce company JD.com said earlier in January 2024 its online auction platform has sold 11 homes worth more than 10 million yuan each in the first 10 days of January.

JD.com said it planned more auctions of luxury homes in top-tier cities including Beijing and Shanghai during the Chinese New Year holidays. REUTERS