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More Chinese Homebuyers Refuse to Pay Mortgage Loans Amid Contagion Fears

  • Bank stocks fell on concern property crisis is spreading
  • Projects facing mortgage snubs more than tripled since Monday
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WATCH: A debt selloff is expanding to Chinese firms once deemed safe from the cash crunch as some angry home buyers are refusing to pay mortgages. Rebecca Choong Wilkins reports.Source: Bloomberg
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A rapidly increasing number of disgruntled Chinese homebuyers are refusing to pay mortgages for unfinished construction projects, exacerbating the country’s real estate woes and stoking fears that the crisis will spread to the wider financial system.

Homebuyers have stopped mortgage payments on at least 100 projects in more than 50 cities as of Wednesday, according to researcher China Real Estate Information Corp. That’s up from 58 projects on Tuesday and only 28 on Monday, according to Jefferies Financial Group Inc. analysts including Shujin Chen.