Should the giant real estate company file for bankruptcy, an industry insider warned that the impact could have an immediate and “serious impact” on the UK market. Speaking to Express.co.uk, Jonathan Rolande from House buy quickly, London in particular said that a collapse in the Chinese real estate market will be directly affected. With the market accounting for 29 percent of China’s GDP, Rolande drew parallels with the 2008 financial crash.
He said, “2008 started with sub-prime lending with banks that we had never heard of in the US.
“We have the direct impact of Chinese investment in London, so that’s an immediate impact and then the haunted effect.
âWhy is the average price Â£ 270,000? Because it’s worth it.
“Why? Because people are willing to pay that price.
“As soon as you feel the market is going to rise or fall, it will fill itself.
“So anything that goes wrong as far as China could have serious repercussions here.”
In the vast real estate market, Evergrande is one of the largest companies but has accumulated US $ 305 billion (Â£ 221 billion) in debt.
Mr Rolande added: âThere are cranes on every part of the London skyline.
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“You would see sales plummet. Builders and developers would be shocked.
“Then they would mothball larger projects.”
Although Evergrande tried to sell assets to cover its debts, the German Market Screening Agency claimed the company missed five bond interest payments.
They claimed the deadline was Â£ 110 million in debt to foreign investors.
Given its size, if it went bankrupt, the company could scare lenders around the world, similar to what it did in 2008.