Beijing is seeking to mobilise up to Rmb1tn ($148bn) of loans for stalled property developments, in its most ambitious attempt to revive the debt-stricken sector and mollify home buyers who are boycotting mortgage repayments after lengthy construction delays.

China’s property sector accounts for about one-third of total output in the world’s second-largest economy. The industry’s prolonged downturn was a significant reason, alongside rolling Covid-19 lockdowns across the country, that growth slowed to just 0.4 per cent year on year in the second quarter.

The People’s Bank of China will initially issue about Rmb200bn of low-interest loans, charging about 1.75 per cent a year, to state commercial banks, according to people involved in the discussions.