Sharp Increase in Mainland Judicial Auction Properties Reveals the Tragic Stories Behind Mortgage Defaults

In the first two months of 2025, the number of foreclosed properties in mainland China surged, but the transaction rate was extremely low. With the real estate market collapsing and the economy declining, slashed property prices are everywhere, and stories of despair are being shared by people around.

According to the monitoring data of the China Index Research Institute’s foreclosure database, from January to February 2025, a total of 172,000 various types of foreclosed properties were listed for auction nationwide, an increase of about 4.5% compared to the same period in 2024 when 165,000 properties were listed. Approximately 28,200 properties were sold, with a foreclosure transaction rate of 13.7% and an average discount rate of 74.95%.

In 2024, a total of 768,000 foreclosed properties of all types were listed for auction nationwide, including residential and commercial properties.

However, the above foreclosure property data is only for reference, and the actual number of properties facing foreclosure may be higher.

An industry insider in Xuzhou stated in a video that the number of foreclosed properties nationwide is approaching one million. While the quantity of foreclosed properties has increased, the auction transaction rate is still below 20%. This means that out of the one million properties on banks’ hands, over 800,000 of them remain unsold, turning into worthless concrete structures. Banks are reluctant to take pictures and auction off your property. The auction transaction rate in Xuzhou for foreclosed properties is only around 20%.

He mentioned, “Some people have been in default for one or two years already, and banks not only avoid foreclosing but even the bank managers call and visit you regularly, negotiating to let you repay slightly less each year, offering interest rate reductions, or even zero interest, as long as you at least repay the principal. If you still can’t repay the money, some banks may help you find a job so you can work and repay debts simultaneously. In short, they are begging you not to default anymore.”

Ms. Wang, working in a financial department in Anhui, confirmed through a bank that it’s difficult to auction off foreclosed properties now as many people cannot repay their loans due to unemployment and reduced income. Even if the properties are auctioned off, there are many complications afterward, such as the individuals having only one home to live in and nowhere else, making enforcement difficult. Banks are currently extending the repayment period, allowing those who cannot pay this year to defer payment until next year.

The article depicts numerous heart-wrenching stories of individuals burdened with debts and struggling to cope with the harsh consequences of the collapsed real estate market. From families losing their homes to tragic incidents like suicides due to financial pressure, the impact of the economic crisis is devastating.

Amidst the turmoil in the real estate sector, suicides have been on the rise with cases reported in various cities like Taiyuan, Chongqing, and even smaller towns like Liaocheng in Shandong province. The pressure of unemployment and mounting housing debts has led to a series of tragic events such as people jumping off bridges or buildings to escape their financial woes.

In 2024, the hardship ranking listed individuals facing challenges of unemployment, no savings, housing loans, raising children, debts, repayment demands, illnesses, parents’ health issues and property foreclosure. Among them, Guo Qiang’s story stands out as particularly tragic, compounded by unfortunate legal troubles.

Guo Qiang, a debtor from the post-80s generation, shared his struggles of once being a successful entrepreneur in the food industry and branching out into convenience stores in Southeast Asia. However, setbacks caused by the epidemic and legal battles froze his assets, pushing him into a downward spiral of mounting debts and personal tragedies.

As Guo Qiang’s story unfolds over the years, the experiences of loss and financial ruin paint a grim picture of the societal impacts of the economic downturn. His tale of mounting debts, frozen assets, and personal losses resonates with the struggles faced by many individuals caught in the turbulent real estate crisis.

The despair and hopelessness gripping individuals like Guo Qiang reflect a larger trend of financial hardships faced by numerous families across the country. The economic downturn and plummeting property values have left many in dire straits, with debts piling up and no viable solutions in sight.

In the midst of widespread financial distress and personal tragedies, the stories shared by individuals like Guo Qiang underscore the urgent need for comprehensive support systems and effective interventions to prevent further escalation of the economic and social crises gripping the nation.