Core Viewpoint - The real estate market has been increasingly sluggish over the past two years, with high property prices in major cities leading to a lack of buyers and a significant number of unsold properties [1][4][35]. Group 1: Market Challenges - The real estate market faces three major challenges: the issue of vacant properties, the surge in foreclosed properties, and the problem of unfinished buildings [2][6][16]. - The number of vacant properties in China is approximately 130 million, which could theoretically accommodate 300 to 400 million people, highlighting a significant waste of resources due to speculative buying [8][10]. - The increase in foreclosed properties has been dramatic, with over 1.6 million in 2021, rising to over 3 million in 2022, and projected to exceed 3.5 million in 2023, driven by economic uncertainty and rising defaults [17][19][21]. Group 2: Economic Implications - The rise in vacant and foreclosed properties is causing a strain on banks, leading to increased operational costs and potential liquidity issues, which could further destabilize the financial system [23][41]. - The unfinished buildings, or "zombie projects," are a result of developers mismanaging funds and facing tightening financing conditions, which negatively impacts urban development and the overall economy [27][29][39]. Group 3: Market Dynamics - The current real estate environment is characterized by a shift back to the fundamental value of housing, with location becoming a critical factor, while the overall market remains oversupplied [33][41]. - The government is attempting to stimulate the market by expanding the buyer pool and reducing restrictions, but significant disparities between property prices and income levels persist, complicating recovery efforts [35][43].