China’s property market downturn, following a prolonged boom-and-bust cycle, risks triggering a broader economic slowdown that could challenge the stability of Xi Jinping’s leadership. Analysts warn that a prolonged slump in real estate—once a key driver of growth—may strain government finances, reduce consumer spending, and weaken investor confidence, echoing Japan’s "lost decades" of stagnation. With property accounting for a significant share of economic activity, the crisis could test Beijing’s ability to maintain growth targets and social stability. The comparison to Tokyo’s post-bubble struggles underscores the potential long-term consequences for China’s economic trajectory.
Tokyo lost decades when a property bust led to an economic slump. Could the same phenomenon undo Xi Jinping’s ambitions?
