Chinese private developers face a 4 trillion yuan (HK$4.32 trillion) funding gap to complete construction of presold homes, according to Goldman Sachs.
The stark warning came as state-backed developer China Vanke (2202) denied reports that it planned to use assets worth 130 billion yuan as collateral for fresh funds.
The Goldman Sachs research report said that the huge funding gap adds to the woes of an industry that has yet to bottom out.
Credit support from banks - which totaled 469 billion yuan as of the end of March - "appears well below the amount needed for securing home completions," analysts led by Lisheng Wang wrote.
As China's real estate crisis continues, the impact of property easing measures from last year are fading in the new homes market, they said.
Many metrics tracking the industry continue to worsen and developers' funding conditions remain stretched. Compared with previous major housing cycles, the magnitude of policy actions "appears small," the analysts added.
"The housing sector has not yet reached the bottom of the L-shaped path we expect," they wrote.
Earlier, Bloomberg reported that China Vanke is reportedly preparing an asset package totaling about 130 billion yuan to use as collateral as it seeks new bank loans.
The developer is supported by the Shenzhen government and regarded as a "good student" compared with other embattled developers,
A company executive told analysts about the plan at an investor event on Sunday.
Separately, some of Vanke's regional units are said to be setting up teams for potential asset sales, the report added.
But Vanke later denied the reports, with its investor relations department saying that it didn't know anything about the asset package.
Vanke added that it currently has no plan to sell quality "light assets" such as property management businesses.
But it may sell some "heavy" projects which are running well at an "appropriate timing" if the company finds it necessary.
Overall, Vanke is reviewing its portfolio and trying to offload some "heavy assets" while maintaining the rights to manage them.
Vanke's Hong Kong-listed shares once rose as much as 2.3 percent, the most in more than a month, after the builder said it has made plans to resolve liquidity pressure.
However, it ended at HK$3.82 apiece yesterday, 0.78 percent lower than the previous close.
