China’s fixed asset investment (FAI) experienced a significant downturn in October, reflecting mounting pressures on the real economy as the ongoing property crisis continues to dampen economic activity. According to the National Bureau of Statistics (NBS), the cumulative FAI for the first ten months of 2023 stood at 40.89 trillion yuan ($5.7 trillion), marking a 1.7% year-on-year contraction. This represents a sharp deterioration compared to the 0.5% decline recorded in the first nine months of the year. In October alone, FAI plummeted by 12% to 3.74 trillion yuan, down from 4.25 trillion yuan in the same period last year. All three major sectors—primary, secondary, and tertiary industries—registered declines, with residential property development investment dropping 13.8% year-on-year to 5.66 trillion yuan in the first ten months. The property sector’s slump has been a significant drag on overall investment, accounting for a three-percentage-point reduction in growth. Despite these challenges, NBS spokesperson Fu Linghui emphasized that excluding real estate, FAI grew by 1.7% during the same period. He also highlighted robust expansion in high-tech industries, with aerospace manufacturing up 19.7% and information services investment surging 32.7%. However, analysts caution that China’s economy is entering the final quarter on a weakening trajectory, with softer industrial output and sluggish household consumption exacerbating the slowdown. The property market’s downward spiral, triggered by the Evergrande Group debt crisis in 2020, continues to weigh heavily on consumer confidence and investment. Home prices in major cities have shown broad-based declines, with first-tier cities experiencing a 4.4% year-on-year drop in October. Experts predict further adjustments in housing prices over the next three years, with some regions potentially hitting historic lows. The prolonged correction in the property sector reflects a deliberate policy shift away from property-led growth, but a genuine recovery will depend on rebuilding fundamentals such as employment, income growth, and social protections. Meanwhile, falling home prices are eroding household wealth, with over 70% of family assets tied to property, leading to reduced consumption and job market pressures. As China navigates these challenges, policymakers face the delicate task of balancing structural reforms with short-term stabilization measures.