Posted on 07/28/2022 2:47:01 PM PDT by george76
China’s property sales will likely drop by about 30% this year — nearly two times worse than their prior forecast, S&P Global Ratings said, citing a growing number of Chinese homebuyers suspending their mortgage payments.
Such a drop would be worse than in 2008 when sales fell by roughly 20%, Esther Liu, director at S&P Global Ratings, said in a phone interview Wednesday.
The latest developments have delayed a recovery in China’s real estate sector to next year from this year, she said.
...
Most homes in China are sold before completion, generating an important source of cash flow for developers. The businesses have struggled to obtain financing in the last two years as Beijing cracked down on their high reliance on debt for growth.
Now, the mortgage strike is damaging market confidence, delaying a recovery of China’s real estate sector to next year rather than this year, Liu said.
If there is a sharp decline in home prices, this could threaten financial stability.
...
There’s also the potential for social unrest if homebuyers don’t get the apartments they paid for
(Excerpt) Read more at cnbc.com ...
They’ll just increase the buying in the US by 30%
Thing is, this whole last man holding the “investment” gets screwed economy of theirs doesn’t mean those getting out have figured out that real estate bubbles happen elsewhere. How much of our real estate boom is now being fueled by mainland Chinese looking for a place to put their money now that they got some sucker to buy their useless, uninhabitable apartments in “cities” in the middle of nowhere?
Tanks are on the streets in China to protect the banks because the Henan branch of the Bank of China declaring that people’s savings in their branch are now ‘investment products’ and can not be withdrawn.
https://twitter.com/i/status/1549790086656581640
Now China...one can only imagine the poor state of RE risk-taking.
This is China. It wouldn’t surprise me if Xi ordered the PLA to seize certain companies, and their employees, and force them to complete these unfinished projects. Then he could force the sale of remaining assets and then force the buyers to resume their mortgage payments.
A banker in a communist country doesn’t really have to even pretend it’s not your money. Ultimately it isn’t and he’s got the government to back him up.
You know, we Americans should get down on our knees and thank the Lord for “robber barons” who industrialized this country on the backs of voluntary participation commerce rather than filling the land with mass graves the way many socialists did.
China’s real estate sector has been intertwined with local governments and land use policy, making the industry’s problems difficult to resolve quickly.
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AKA, corporatism, AKA fascism.
“useless, uninhabitable apartments in “cities” in the middle of nowhere”
Now they are putting tons of money in useless, uninhabitable Democrat-run cities in the US. The bubble heads our way from across the Pacific.
(What the h$ll these foreigners think they are doing in the US real estate market is beyond me. They are buying “new” homes not realizing an entire neighborhood of rental homes is what we call a ghetto.)
Apartments are going up fast and furious here in North Texas. Fueled by people fleeing Democrat paradises but probably not realizing they bring the cancer with them if they’re gonna still vote for rats.
I just read that richest woman in China list half her $24 billion net worth on the property wipeout.
Been hearing this for about 3 years now.
If you’ve seen some of the alleged “construction” you would renege on your mortgage payments too.
CC
China has been having some bank runs also, with several banks refusing to return depositors money.
They have mountains of bad debt in the Chinese financial system. Fraud is standard business practice there - Government and private sector.
“Thing is, this whole last man holding the “investment” gets screwed economy of theirs doesn’t mean those getting out have figured out that real estate bubbles happen elsewhere.”
Some investors don’t care what part of the cycle is happening. They care about getting the right property and they are willing to wait many years to cash out. Just talked to a friend who paid $100k for a property a few years before the real estate crash of 2008. He used the property himself for a few years, then rented it, which is how he paid it off. Now he’s selling it for $1.6 million.
2% extra for cement, 4 no-show jobs and 8 no work jobs. Then of course, the permit people. The inspectors. The city planners. The zoning commission. The home owners association. Don’t forget the radon detectors!
They were talking about that on the radio this morning. After Florida and Texas our state is one of the ones people are moving to. But we don’t want them if they are just going to bring Chicago with them.
There’s a saying used in an old Clint Eastwood movie. He was watching after a teenage girl who drifted from place to place finding trouble wherever she went. Clint told her “Just remember, wherever you go there you are.”
I'm starting to read a lot about this.
More ghost (empty) cities? Woot? /s
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