Developers’ First-Quarter Bond Sales Hit Five-Year High

What’s New: Chinese real estate companies borrowed more in the first quarter through bond sales, indicating easier financing access for cash-thirty developers.

During the first three months, Chinese developers raised a total of 377 billion yuan ($53.5 billion) from domestic and overseas bond sales, up 4% from a year ago and the highest total since 2015, according to Everbright Securities.

In March alone, domestic bond sales by developers reached 113 billion yuan, up 55% from the previous year, despite a pause in overseas bond sales amid market fluctuations, Everbright said.

Background: Developers in China are enjoying a loosening fundraising environment after more than three years of strict controls to contain property bubbles. Market liquidity improved both at home and abroad as monetary authorities stepped up easing efforts to bolster the economy amid the pandemic, reducing financing costs for developers, analysts said.

In the first quarter, China’s total social financing jumped to 11.08 trillion yuan, adding 2.47 trillion yuan from the same time last year, central bank data showed. Local authorities have also eased controls on property markets to deal with the outbreak fallout.

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Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com)