Last night on 60 Minutes, there was quite a segment on China’s residential real estate market which offered a fresh look at an old story — China’s “ghost cities”. The video is available at bottom.
Updated information since first posting here almost two years ago is the fact every one of these millions of vacant apartments is reportedly sold. With investors banking on the gains of the past to continue, not to mention people actually inhabiting these cities, the report contemplates the damage that a bursting bubble would create.
There’s plenty more up to the minute insight available at The New York Times here amid news today that Chinese shares fell the most in two years Monday. The Shanghai stock exchange’s property index tumbled 9.25 per cent today — explained by the announcement late Friday of a new set of government policies aimed at cooling down the housing market.
“.. a simple description of China’s housing market as a ‘bubble’ misses the point. Does ‘bubble’ refer to the soaring prices in the biggest cities, where only the wealthy can afford homes? Or does it refer to the row upon row of empty apartment blocks in the smaller cities?” – Financial Times