Chinese consumers are using bank loans for down-payments on home purchases even as the nation seeks to redirect investment away from China's hot real estate market. People's Bank of China figures reveal that while short-term consumer credit surged 160% in the first eight months of the year, retail sales rose just 10.4% in August. The government has been trying to boost consumption by encouraging people to spend more and boosting household savings through a series of measures including raising interest rates last year and increasing taxes this year.
Chinese consumers are using bank loans for down-payments on home purchases even as the nation seeks to redirect investment away from China's hot real estate market. People's Bank of China figures reveal that while short-term consumer credit surged 160% in the first eight months of the year, retail sales rose just 10.4% in August. Many consumers in China view property as a secure way to store their wealth at a time when alternative investments offer poor returns.