Chinese property sales continue to decline, Jiayuan development incurs losses of 28.5 billion yuan

China’s well-known real estate developer, Jiayueye Group Holdings Co., Ltd., released its 2024 performance announcement on March 31, revealing a staggering net loss of 28.531 billion Chinese yuan for the full year. This figure not only highlights Jiayueye’s recent operational difficulties, but also reflects the continued sluggishness in the Chinese real estate market.

According to Jiayueye Group’s announcement, in 2024, the company achieved revenue of approximately 11.561 billion yuan, a 55.8% year-on-year decrease; realized gross profit of around 0.238 billion yuan, an 86% year-on-year decline; and the company’s equity holders’ share of the loss was 28.531 billion yuan.

The announcement indicated that Jiayueye’s massive loss in 2024 was mainly attributed to multiple factors. The continuous downturn in the domestic real estate market led to a significant decline in the company’s project sales revenue, slow inventory turnover of some properties, making it difficult to recover funds. Additionally, the high debt burden further exacerbated the financial pressure.

As of the end of 2024, Jiayueye Group’s total debt remained substantial, with its debt repayment capacity drawing market attention. Moreover, policy regulation, tightened financing channels, and insufficient consumer confidence posed significant challenges to the company’s operations.

By the end of 2024, Jiayueye had a cash and bank deposit balance of approximately 2.3904 billion yuan, a 29.7% decrease from December 31, 2023. As of December 31, 2024, the total borrowings of Jiayueye were around 135.074 billion yuan, of which about 118.078 billion yuan needed to be repaid within a year as required.

Jiayueye Group used to be a star enterprise in the Chinese real estate industry known for its aggressive expansion and large-scale developments. However, since the end of 2021, the company has been mired in a liquidity crisis, with multiple debt default incidents. Despite attempting self-rescue through asset disposals and debt restructuring in recent years, the results have been limited. Industry analysts believe that the 28.5 billion yuan loss not only reflects Jiayueye’s failure in its own strategic adjustment but also highlights the vulnerability of the entire industry under high leverage.

Regarding future development, Jiayueye Group’s management stated that they would continue to promote cost reduction and efficiency improvement, optimize asset structure, and actively negotiate with creditors to seek more flexible debt resolution solutions. However, the market remains cautious about its prospects. Some analysts believe that if the macroeconomic environment does not show significant improvement, Jiayueye may struggle to reverse its decline in the short term.

In recent days, several Chinese real estate companies have released their 2024 loss performances, including Country Garden with a net loss of 32.8 billion yuan, Sunac China with a net loss of 25.7 billion yuan, Greentown Group with a net loss of 18.6 billion yuan, and Vanke with a net loss of 49.4 billion yuan.

On March 31, the China Index Research Institute released the “2025 Q1-Q3 China Real Estate Companies Sales Performance Ranking.” Data showed that in March alone this year, the sales of the top 100 real estate enterprises in China decreased by 10.6% year-on-year. From January to March, the total sales of the top 100 real estate enterprises were 810.1 billion yuan, a 9.8% year-on-year decrease.

In the first quarter of this year, there were 17 real estate companies with sales exceeding 10 billion yuan, 4 fewer than the same period last year; and 38 companies with sales exceeding 5 billion yuan, 2 fewer than the same period last year.

The continued downturn in the Chinese real estate industry has shaken the confidence of many investors in related companies. Experts predict that 2025 may be a critical year for further reshuffling of the Chinese real estate market, and whether these loss-making real estate companies can overcome their difficulties remains uncertain.