The real estate crisis in China continues to expand, with a Chinese American buyer becoming the latest victim of the unfinished projects.
According to Apollo News, a Chinese woman named Olivia in Los Angeles, California, bought a property in Shanghai a few years ago. But the entire building has not been completed until now.
The woman initially paid 3 million yuan (about 450,000 dollars) in cash for the house in advance. She is now unsure when the house will be delivered.
Olivia’s family bought a three-bedroom apartment in Chongming district, Shanghai, in February 2018.
She said that the purpose of buying the house is to stay when she returns to Shanghai to visit relatives every year. Although she has immigrated to the United States, she wants to have a house in her hometown.
The property she bought is located on Changxing Island, Chongming District. It is called Cathay Courtyard, which means big city and small courtyard.
The developer, Tahoe Group, is a well-known large-scale company, specializing in residential and commercial real estate in major cities in China.
Olivia recalled that when the real estate project was pre-sold, the scene was very lively. Every day, hundreds of people went to see the sample houses, and everyone was rushing to buy the houses.
There are nearly 2,000 apartments and villas in Changxing Island’s Cathay Courtyard project.
Olivia said that because many people lined up to buy houses, the sales office had to use a lottery to choose the buyers.
Olivia remembered that she didn’t win in the first round of draws. In the second round, she rushed to the sales office before dawn and waited in line, and her number was chosen. The whole family was very excited and felt lucky.
The apartment Olivia bought is worth 3 million yuan, almost 446.000 dollars, and covers an area of about 100 square meters. Because it is inconvenient to pay in installments in Shanghai, Olivia decided to pay the house entirely in cash.
According to the contract, the house would be handed over two and a half years later.
But at the end of February 2020, Olivia’s parents in Shanghai received a letter. It read, “Due to the force majeure of the (Covid) epidemic, the project may be postponed in due course”.
The letter did not mention when the developer would hand over the house, nor was there any commitment to compensation.
Olivia had to console her parents by telling them that Covid’s epidemic is really serious, and that the postponement of the project is also a matter of course. She told them not to worry because such a big real estate project cannot have problems.
She said she used to think that even if there were unfinished buildings all over China, it would never happen in Shanghai, a top metropolis in the country.
But then news broke out that Tahoe Group suspended its real estate projects across the country, including Tahoe Hangzhou Yard, Tahoe Suzhou Jinzun Mansion, Tahoe Taiyuan Jinzun Mansion, etc. All of these projects experienced delayed delivery or long-term suspension.
This made Olivia worry. She said that she is in Los Angeles, and can’t go back to China because of the country’s Covid containment measures. So she can only ask her family in Shanghai to find out about the project.
Olivia also joined a buyers’ rights protection group on WeChat. There are more than 1,800 buyers in the same situation as hers.
She said that most people buy houses with loans. Some sold their original houses to pay for this project, so they rented another house to live in, and now have to pay rent and loans every month. It’s a miserable situation.
However, there is no indication that construction will resume, and housing delivery is still a long way off.