Real estate, stocks lose appeal in China as people shift to savings, gold

The housing and stock markets, once primary avenues for wealth accumulation among Chinese citizens, no longer provide the same huge gains they did in the past decades.

China's benchmark CSI 300 index fell to its five-year low earlier this month, as reported by the South China Morning Post.

The index has slid 38% in the past three years.

Meanwhile, 70 large and medium-sized cities have witnessed steep declines in house prices last December, according to data from China's National Bureau of Statistics.

The official figures show prices declining at the highest rate since nine years ago.

Compared to 2022, last year saw an 8.5% drop in the total area of property sold across China and a 6.5% dip in property sales revenue.

With a recovery still far out of sight, investors’ lack of confidence in the economy has shifted their focus towards safer assets for wealth preservation.

Household deposits have more than doubled since 2021, totaling 16.67 trillion yuan (US$2.31 trillion) last year, according to data from the People's Bank of China.

Additionally, gold has emerged as the preferred investment choice for people in China, according to the Economic Times.

China’s investment in gold bars and coins grew 28 per cent to 280 tons in 2023, according to the Gold Demand Trends Full Year 2023 report by the World Gold Council.

The country’s gold jewelry consumption was the highest in the world at 630 tons, the report said.