The enduring housing crisis has inflicted considerable hardship on homebuyers across the nation in China, many of whom invested their life savings in properties that were never realized.

Trading of China Evergrande Group, a deeply indebted Chinese property developer, was halted in Hong Kong on Thursday, as announced by the Hong Kong stock exchange.

The suspension followed a report by Bloomberg News, revealing that Hui Ka Yan, the chairman of Evergrande, had been removed earlier this month and was placed under police supervision, according to individuals familiar with the situation.

On the day prior to the suspension, Evergrande’s shares closed at 32 Hong Kong cents. The company had only recently resumed trading on August 28 after a 17-month hiatus.

In a filing last week, Evergrande disclosed the postponement of a planned debt restructuring meeting with creditors, citing underwhelming group sales as the reason. In a prior event earlier in September, the police in Shenzhen, a southern Chinese city, had reported detaining certain staff members from China Evergrande Group’s wealth management division.

For a substantial period, China’s real estate sector has played a pivotal role in economic growth, constituting approximately one-quarter of the country’s GDP, closely intertwined with the construction industry. It underwent a remarkable and prosperous expansion over the past few decades.

However, Beijing has increasingly regarded the colossal debt amassed by major players in this industry as a perilous threat to the nation’s financial stability and overall economic well-being in recent years.

Beginning in 2020, the government has been progressively restricting developers’ access to credit, leading to a subsequent wave of defaults, most notably exemplified by Evergrande.

The enduring housing crisis has inflicted considerable hardship on homebuyers across the nation in China, many of whom invested their life savings in properties that were never realized.

Last summer, a widespread wave of mortgage boycotts swept the country as financially strained developers struggled to secure enough funds to complete homes that had already been pre-sold, a common practice in China, as per report on AFP.