What’s new: Shares of Nasdaq-listed Chinese online real estate marketplace FangDD Network Group Ltd. plunged 25% on Monday to finish at $0.75, after the firm posted a dramatic turn into loss toward the end of the prior week of trading.
FangDD reported a net loss of 355 million yuan ($55.6 million), down from a net profit of 21.9 million yuan last year, while its revenue plunged 79% year-on-year to 169 million yuan, according to the quarterly financial results published on Friday. Back in the second quarter, the firm’s net loss was 139 million yuan and its revenue reached over 400 million yuan.
In the statement, FangDD attributed the plunge in revenue to the broader “continuous downturn” in the real estate sector that led to a drop in business, while the hefty loss was due to “a provision of 253 million yuan for impairment of certain assets,” such as developer dues.
In the third quarter, 10,600 brokers sold homes on the FangDD platform, a 44.2% drop from 19,000 in the previous quarter. The total value of homes sold on the platform dropped 48.5% quarter-on-quarter to 15.2 billion yuan.
Background: Earlier this month, another Chinese real estate agency KE Holdings Inc. announced it had plunged more than 1.7 billion yuan into the red, on the back of a one-third decline in existing home sales.
Traditionally, September and October are a high season for property sales, but sales in China’s troubled property sector have continued to cool. In October, property sales of the country’s top 100 developers dropped 32.2% year-on-year, following a 36.2% slump the previous month, according to a report released by real estate data collector China Real Estate Information Corp.
Contact reporter Manyun Zou (manyunzou@caixin.com) and editor Bertrand Teo (bertrandteo@caixin.com)
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