China, the world's second-largest economy, is currently grappling with a deepening crisis in its real estate market, which has been in decline for nearly five years. Properties are losing value, sales are plummeting, and developers are struggling with cash flow problems due to overwhelming debt. The situation has become so dire that companies are resorting to taking more loans to pay off existing debts, putting them in a vicious cycle of financial instability.

Between 2025 and 2026, average house prices in China are projected to drop by over 5%, revealing a stark picture where homes are constructed but buyers are absent. This absence of buyers is exacerbating the crisis, with the government attempting to intervene but finding its efforts insufficient to counteract the growing challenges. The real estate sector is now not just a concern for individual companies, but it poses significant risks to the broader economy given its size and relevance to economic health.

Furthermore, major real estate developers like Evergrande and Country Garden are facing imminent threats, with uncertainties surrounding China Vanke, another significant player. These prominent companies are indicative of the instability afflicting China's real estate market, raising alarming concerns about the potential consequences this may have on the country's overall economic trajectory and the livelihoods of millions dependent on this sector.