China’s Real Estate Bubble May Have Just Popped | Foreign Affairs

Sudden, steep price reductions are upending real estate markets across China. According to the property agency Homelink, new home prices in Beijing dropped 35 percent in November alone. And the free fall may continue for some time. Centaline, another leading property agency, estimates that developers have built up 22 months’ worth of unsold inventory in Beijing and 21 months’ worth in Shanghai. Everyone from local landowners to Chinese speculators and international investors are now worrying that these discounts indicate that “the biggest bubble of the century,” as it was called earlier this year, has just popped, with serious consequences not only for one of the world’s most promising economies — but internationally as well.

via China’s Real Estate Bubble May Have Just Popped | Foreign Affairs.

7 Replies to “China’s Real Estate Bubble May Have Just Popped | Foreign Affairs”

  1. can i just ask if anyone else is amused by the hillaritiy of these commentaries? Honestly, 19000 the decisive level in the Dow – had a look now? Eurodollar breaks 1.32 and that gives us 1.22! yeah, pal, have a look at the chart.The clue is that the geezah has his own “twiggs” index – the indicator that noone can know the secret of…until the curtain is pulled back to reveal the magician behind the curtain

    1. Marcus, You are welcome to your views. Perhaps you overlooked the My Strategy link from the newsletters. In a nutshell: the market can go up or it can go down at any time — all that changes are the probabilities. The targets offered are mostly for the primary cycle and $1.22 is still valid for the EURUSD. Regards, Colin

  2. Sorry Coilin, that doesn’t really wash does it?. “The markets can go up or down” brilliant excuse……oh, per..lease! So what are you there for…..let’s just spin a coin, then……

  3. A lot of the talk of the drop in house prices in China ignores the fact that the Chinese government deliberately popped the bubble because there were huge amounts of real estate being built and lying empty while most chineese could not afford to live in any of them. Sadly I don’t have exact details about the policy change but this is not a market operating under the same principles as western capitalist economies.

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