On 25 August 2025, Evergrande's shares were removed from the Hong Kong stock exchange. A court had ordered the property developer's liquidation on 29 January 2024, and its liquidators have cited debts of roughly US$45 billion.
For shareholders, a delisting is the last stage of a long loss. For a different group, ordinary households who paid for homes before they were built, the stock price was never the exposure.
When you pay a developer in advance, you are not buying a flat. You are lending the developer money against a promise to deliver one.
What a pre-sale really is
In China's property market, many homes are sold before construction is finished. The buyer pays a deposit, and often the full price or a large part of it, years ahead of delivery.
From the buyer's side, the position looks like this:
- The buyer is a creditor. Until the home is delivered, the buyer has paid for something that does not yet exist. If the developer cannot finish, the buyer's claim is only as good as the developer's finances and the legal protection for pre-sale funds.
- The risk is concentrated. The same developer's financial health decides whether the home is finished, whether the neighbours' homes are finished, and the value of the home if it is.
- The buyer usually has a mortgage. A household may keep paying a loan for a home that is not delivered.
The scale of the problem is visible in delivery figures. Country Garden, another large developer, delivered about 380,000 homes in 2024 against a target of 480,000, and has been negotiating a roughly US$17.7 billion restructuring of its offshore debt.
The wider household picture
Residential property is reported to make up about 70% of urban Chinese household assets. That figure comes from a secondary source we could not match to a statistical release, but the direction is not in dispute. A household with most of its wealth in property, and some of that in a pre-sold home, holds a concentrated position in a sector under stress. See your biggest position was never a decision.
The fundamentals
Know your place in the line. In any failure, creditors are paid in an order set by law and contract. A buyer of an unfinished home has to understand where they rank and what protections exist.
Counterparty risk is credit risk. Paying in advance is lending. A lender asks about the borrower's finances, other obligations and history of delivery. A buyer should ask the same.
Diversify by sector, not only by asset. Owning two flats from two developers is not diversification if both depend on the same property cycle. Real diversification spreads across assets that respond to different forces.
Leverage makes it worse. A mortgage turns a loss of confidence into a fixed obligation. The size of the loan relative to income and to what the asset could realistically sell for is the measure of resilience.
Practical implications
- Before a pre-sale purchase, ask how the money is protected: who holds it, what releases it, and what happens if work stops.
- Check the developer's delivery record, not its marketing.
- Prefer finished or nearly finished homes if you cannot tolerate delivery risk.
- Limit the share of net worth in any single property sector.
- Read the mortgage terms for what happens if the home is not delivered.
- Keep cash outside property so that a problem in one place does not force a sale elsewhere.
Update, October 2026: what the following year added
Country Garden's offshore restructuring became effective on 30 December 2025. Another large developer, Vanke, relied on repeated extensions of its onshore bonds through 2026. One report put new-home prices across 70 cities down 3.5% year on year in May 2026, the 35th consecutive month of decline, though sources disagree on the exact count of months.
What we could not confirm
The body of this post reflects what was known on 26 August 2025; later developments are in the update section. Legal protections for pre-sale funds differ by city and over time, and we did not research them. The 70% share and the price-decline figures come from secondary sources. This is education, not investment or legal advice.
Sources
- Bloomberg, Evergrande stock to delist in China property crisis milestone (12 August 2025); NPR, Evergrande's delisting: key facts (25 August 2025)
- Caixin, Country Garden restructuring and 2024 deliveries (January 2025); Kirkland & Ellis, Country Garden restructuring (January 2026)
- Caixin, Vanke wins new funding as it completes extensions on 2026 public bonds (23 July 2026); The Real Deal, Home price growth in China decimated back to 2005 levels (7 July 2026)