Investor confidence in China’s troubled property sector has been rocked again this week by reports that one of the country’s largest private building conglomerates missed interest payments on two bonds.
Investor confidence in China’s troubled property sector has been rocked again this week by reports that one of the country’s largest private building conglomerates missed interest payments on two bonds.
Building ghosts cities to hold 30 million people and then not filling them. Who would have thought that’s not a valid strategy for property management?
They are now filled.
Some are, but not all. The point here is building entire towns or entire new city sectors in one fell swoop instead of planning them out and building them in stages so plans can be adjusted as needs inevitably change is a bad idea. It’s things like this that have directly led to the current property market crisis.
Of course if buildings are already there it makes sense to use them, but they might have been able to put something better suited or more economically viable there if they had staggered the construction.
Your propaganda is a decade out of date. If you actually read the article, the current issue is that a lot of people aren’t receiving the housing they prepaid for.
Aside from that, I’ll take “too much housing” over the hell world of trying to find a place to live in the US any day of the week. The ghost cities complaint always seemed like coping to me.
Tankies are really one to talk about Propaganda. Go away!
How childish.
I’ll just leave this here for you to think about.
You are correct, the “ghost city” claim is about a decade old and in the time since then good functioning cities developed incorporating those infrastructure and urban resources built previously.
Zhujiang New Town for example can house up to two million people (often moving out from the 7-10 million living in the old areas) and while I dislike the urban planing of it, it was once among the foremost called “ghost city” in propaganda, yet it is larger than most cities in most states of the US as example.
I also agree that having too many flats seems to not be that bad a problem to have. Especially when 2‰ of the US are unhoused - even though there are millions of empty flats.
Right up until the demand for housing turns flat and then negative due to unquestionable demographic realities facing China. When such a huge percentage of the populations net worth is tied to real estate, the impact of a housing crash can’t be ignored. And there is a storm coming, the numbers don’t lie. In the next 20 years China’s population WILL shrink
https://www.salon.com/2023/07/30/chinas-great-leap-backward-so-much-for-the-next-dominant-superpower/
https://www.huffpost.com/entry/china-population-drop_n_63c69f7be4b0cbfd55f616e2
https://www.economist.com/graphic-detail/2023/08/03/china-will-become-less-populous-more-productive-and-more-pricey
The numbers will sink in the next 20 years for pretty much all “developed” OECD countries. Including the US, UK, France, Germany… yet how often do you personally write about that problem? When even people like professor Reich of Berkeley mention the 40(?) trillion $ wealth transfer due to shrinking population and that mostly to a small group of population with reduced demand for housing you seem to focus a lot on a country you are not living in.
Do I think China faces challenges? Surely. Do I think the capitalist market oriented parts of it will lead to problems that are integral to capitalist market systems? Sure. The CPC has much more power to act on it though. China is currently able to house its population much better than 30 years ago after the crisis of the fall of the Soviet Union. Germany’s capital is missing 600k affordable flats at the same time.
Lets see how things will play out, but similar articles were published every couple of months for the last 20 something years. That generates sentiment.
The difference between those OECD countries is that they allow migration. Nationalistic and racist temper tantrums notwithstanding, those countries are bolstering their working age ranks with migrants. China is distinctly anti-migration. So they’ve been digging a giant hole that’s going to take a LOT to fill. And they haven’t even stopped digging yet (first rule of getting out of a hole!)
So, could China change that stance as a way to mitigate the issue? Sure. But they better up their human rights record or they are only going to attract the most desperate of migrant with no other options. That doesn’t bode well for a strong economic engine. Though cheap exploitable labor does help [shrug]
Their housing market is still unaffordable for Chinese citizens. Rather be in an unaffordable housing market where I get what I pay for. Like the house, that I’m typing this in. Which I paid for, and then got the keys to.