Chinese real estate investment continues to decline
Despite the increase in production and consumption indicators in the Chinese economy in May, the decline in real estate investments negatively affected fixed investments.

The National Bureau of Statistics (NBS) released the dataset for May 2024 and the first 4 months of the year, including industrial production, retail sales, fixed capital investment and unemployment figures.
The May data showed that after a recovery in the first two months, signs of cooling continued in the following two months. While industrial production and retail sales made positive contributions, the decline in real estate investments continued to drag down fixed capital investments.
Fixed capital investments, which include infrastructure, immovables, machinery and equipment expenditures, increased by 4 percent in the first 5 months compared to the same period last year, but fell behind the 4.2 percent increase in the first 4 months and 4.5 percent in the first quarter.
Among fixed capital investments, infrastructure and manufacturing investments increased by 5.7 percent and 9.6 percent, respectively, while real estate investments continued to decline by 10.1 percent.
Excluding real estate investments, fixed capital investments increased by 8.6 percent in the first 5 months, while the decline in real estate investments continued to pull down overall investments.
On the other hand, real estate sales decreased by 20.3 percent in terms of floor area and 27.9 percent in terms of sales value in the first 5 months compared to the same period last year.
Despite the government's announcement last month that it would allocate 300 billion yuan (about $41.4 billion) in resources to dissolve the completed but unsold housing stock to revive the real estate sector, the measures have not yet had the expected effect.
Liu Ayhua, spokesperson for the NIB, said that it will take time for the policy measures to take effect and that the real estate market is in the process of adaptation.
Industrial production, which calculates the production output of industrial enterprises with an annual turnover of more than 20 million yuan (about 2.75 million dollars), increased by 5.6 percent in May compared to the same month last year, below the 6.7 percent rise in April.
Retail sales, which are accepted as a measure of consumption, increased by 3.7 percent on an annual basis in May, exceeding the 2.3 percent rise in March. The increase in retail sales was driven by the increase in consumer spending during the 5-day holiday on May 1, Labor Day week.
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