You can see evidence of crisis everywhere you go if you drive through Zhengzhou.

Block after block, shell aftershell of unfinished developments.

This is the most affected area in a country that has a large housing market crisis. This could have a devastating effect on the economy.

The village of Da Wang Zhuang, located just outside the city, is an example of how cruel the Chinese housing boom could be.

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It was once almost entirely farmland, and it is home to around 200 households.

Many people in this area made a deal with a developer to exchange their land for high-rise homes that would be built where their farms were.

The building would take three years. But, eight years later, their old homes are gone and they still wait.

In the shadow of unfinished blocks, there is a small compound for temporary accommodation.

The elderly and vulnerable can still live here, while the more able and younger can rent elsewhere.

This compound is where we meet Wang Fang, her mother.

“We don’t know how many years more we have to wait”

They have very little space here, so there are only two grandparents and sometimes one of Wang Fang’s sons.

Mold is growing on the walls. She claims it has rats and that it is much worse than the one they left behind.

She says, “It’s too little.”

“It would have been more convenient to stay in our own home.

“Places such as ours are more difficult to develop than others.”

She was also made worse by the fact that she lost her job during the pandemic, and was divorced three years earlier.

She is a single mom, struggling to find work and now has to care for her children as well as her parents who are ill.

She says, “We don’t know how many years more we have to wait.”

“We have to be patient. The developer doesn’t have the money to build the house.

“Ofcourse I’m anxious. You have to rent a room if you want to make rent.

Broken lives

There are many remnants of people’s broken lives outside the village.

The construction of a major highway began and now it stops halfway through what was once a village.

It is a vast area of rubble that no one has ever cleared.

However, such cases are not uncommon in China.

Developers have been over-leveraged for years to feed their seemingly endless appetite for development.

In fact, China’s housing sector is responsible for a fifth of its GDP. It has been promoted as an important driver of the country’s incredible growth.

Many of these developers were close to defaulting due to the zero CoVID measures and a decline in confidence.

This was the worst year for the industry in recent history. Sales plunged and home prices plummeted for 16 consecutive months through December.

This meant that construction was stopped across the country and that buyers were left to make the final decisions.

Unfinished, unsafe homes

Many were already paying mortgages for unfinished houses and protestors took to the streets demanding that their payments be withheld.

Others who have no place to go will be moved into unsafe, unfinished blocks.

The government responded by introducing a series of stimulatory measures and loosening restrictions. It stated that the government should focus on restarting stalled development.

Nevertheless, this has allowed some constructions to resume, while others have not.

Some people believe that developers send only a few workers to maintain an appearance of construction being continuing.

One lady in Da Wang Zhuang thought this.

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She is 68 years old, but she does not qualify for the house in the complex for the elderly. Instead she pays rent to her seven-strong family. This is something she did not have before her home was destroyed.

To make ends meet, she must now litter pick.

She says, “You must earn money. My grandchildren need to eat.”

“How is it that the tower block is still unfinished? It is expensive to rent a house for six or seven people.

“There is no living allowance, no transitional allowance, or any other allowance.”

High-risk market, but people still invest

Despite all this, people still invest in property.

We met a man working for another developer, who was building another block just around the corner. He said that people should have faith and trust in the market.

He says, “I don’t worry, it’s ok.”

“The financial environment is now more relaxed than it was at the start of last year, which led to some problems for developers.

“Additionally the government now places a lot more importance on ensuring that pre-sold homes are delivered on time.

“The regulation of money is more strict than ever before. We feel more secure than ever before.

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Third-term challenge to Xi Jinping

The single most difficult task for leaders of China’s ruling communist Party is to get the economy back on track after the ravages caused by the zero COVID-19 regulations. This is especially true as Xi Jinping begins a third unprecedented term of leadership.

The housing market could be a major obstacle to this.

Problem is, stimulus packages may temporarily ease some pain but they don’t address the root problem: a large housing bubble and a highly volatile market that are vulnerable to boom or bust.

This is still a systemic problem that needs to be addressed, and it’s the people who are responsible.