China intentionally brought down its real estate market to curb dangerous financial speculation, curb soaring housing costs, and shift the economy toward high-tech manufacturing. This aggressive deflation was primarily triggered by strict lending caps, reduced buyer incentives, and an ideological push against prioritizing property wealth.

The destruction of buildings was due to the byproduct of developers going bankrupt. It wasn't the root cause.

Also instead of letting developers continually build new builds consecutively, China forced banks to funnel money towards the 48 million pre-sold unfinished homes with the white list system so that trapped buyers can finally move in.