Chinese property companies are rushing to the dollar bond market, almost matching last year’s sales in the first month of 2013 alone, in a frenzy that could inflate the sector’s gearing and the broader risk of a housing price bubble.
In a highly competitive sector where even the biggest developers have market shares of just low single digits, nobody wants to get left behind building up cash as optimism grows that a recovering Chinese economy will boost housing prices.
And with foreign investors desperate for the yields on offer, developers can’t match demand and their funding costs are falling.
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