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The real estate industry in China, once a key driver of economic growth, now faces significant challenges following the implementation of the “Three Red Lines” policy in 2021. This policy, aimed at controlling the debt levels of real estate companies, has particularly impacted small and medium-sized enterprises (SMEs), exacerbating their pre-existing issues such as limited financing channels, poor internal governance, and low corporate credibility. SMEs are now compelled to navigate a market downturn while meeting stringent regulatory requirements, making their survival and growth increasingly difficult. This study investigates the strategies that SMEs in the real estate sector can adopt to thrive under these conditions. It explores potential avenues such as entering less saturated markets, innovating business models, and leveraging local opportunities. The research underscores the importance of policy compliance, improving internal management, and strategic innovation. By adopting these strategies, SMEs can enhance their resilience and adaptability, contributing to the sustainable development of China’s real estate market. The findings offer valuable insights for policymakers and industry stakeholders aiming to support the sector’s stability and growth.
Hengjia Bu (Wed,) studied this question.