They are unwanted for the price that is wanted but for free I bet they could fill them up in a jiffy but that would make them dirty filthy communists and china don't want that ??? /s
Ehhh, you would think that. However, China currently has more housing than people. I think at the moment the excess housing in the country could home an extra 150m people.
You can knock them for ignoring basic fundamental economic ideas like supply and demand, but it's not like they have a large homeless population being unsheltered.
This is, again, just a plainly incorrect take. Basically everyone in China is housed, yes, but a vast proportion of them still live in rural villages. The rural-to-urban transition does need to be planned for, and it's been a huge factor in China's real estate market. China's urbanization rate today is 66%, compared to 75% in Russia and 83% in the US.
I don't really see how your rebuttal conflicts with what I said? Unless you are claiming that developers were building housing for an eventual urbanization project that's going to migrate 150m people to cities within the next year or two......
These are still real estate companies we're talking about. They aren't wanting to be left holding the bag for years while their investment properties dry rot from prolonged vacancies.
Urbanization is expected to hit 75% by 2030... This is analysis corroborated by Morgan Stanley and others, so, unironically, yes.
That's still a bit of a long time for developers to have their money wrapped up in empty apartment complexes. Large buildings like that can start having major issues after months of vacancies, let alone years.
I think it's still more likely that developers'production exceeded immediate demand than it is for them to have planned for them to be vacant for years.
Either way, it's still not an economically sound idea. I think if they had planned for this, it wouldn't have hit the real estate market as hard as it has.
Basically, government officials knew that at some point they needed to aggressively overbuild real estate capacity in order to meet the urbanization demands. I think they predicted an incorrect curve: whereas they perhaps anticipated that urbanization would follow a trend more like Korea (74% at a similar stage in their urbanization trajectory), instead China is following a curve similar to Taiwan (~66%). A mistake in policy, yes, but it has localized effects.
Plus, I think you're missing a far more essential point: China doesn't give a fuck if every real estate developer goes bankrupt. That's just a cost of doing business. Instead, China's just swooping in and buying up distressed assets to turn into public housing. Homeowners aren't left holding the bag: developers are.
Plus, I think you're missing a far more essential point: China doesn't give a fuck if every real estate developer goes bankrupt.
Just because they operate a mixed economy doesn't mean they can ignore material realities. Investments going unrealized arguably have more negative outcomes for more socialized markets.
Instead, China's just swooping in and buying up distressed assets to turn into public housing. Homeowners aren't left holding the bag: developers are.
You can't wring blood from a stone. Its not like it's just the developers cash being used to build the housing, there are subsidies and investments from banks, which are owned by the government. So if a project goes under, the best case scenario is that they buy it back to get some return on investment, but that's still robbing peter to pay peter. It's just not sustainable, especially if you aren't making wind on your other plans like urbanization.
Does china house them or does china do something else with them?
Yes.
Well they could use them as makeshift landfills for their garbage EVs, but people cannot live in them as there is no water, gas or electicity anywhere. And that's only half the problem because there are far more empty shells for an excuse of a home than there are people to populate them. It's one giant ponzi scheme that got completely out of hand over a decade ago and the government struggles a lot to restrain and keep it going at the same time so it doesn't collapse.
yeah it is funny that an article talking about empty, unwanted units also talks about not delivering for poeple that bought them. Its a wierd situation.
What China needs to do is figure out a way to export this property to America, which needs more affordable homes.
That's doable, right?
I live in China. Trust me, you don't want to have those homes in the US. The house I live in has been completed in 2016 and I'm the first tenant, moved in in 2018, and it's got more issues than my dad's house from 1965. Houses here are built as cheaply as possible, skimping on building materials, safety, plumbing, insulation, wiring, etc.
The pricing bubble is just a joke on top. The actual value of the real estate here should be about 20-25% of what it is in reality - for example if I were to buy the house I'm renting right now, I'd break even after 114 years. Not taking any repairs or interest into account.
Sadly, that’s not much different than the US
We're talking about high rise buildings with cardboard mixed into the concrete that collapse within less than 5 years in many many cases. They often don't have plumbing or electricity as they are only constructed to get people to invest in property, not to live in them. US citizens really don't know how much regulations and their enforcement are doing for them.
Nah, the situation is way different in the US. The construction quality is way way better due to building codes and actual enforcement of that. Though some construction does fall through the cracks, it's a good bet that the vast majority of construction here is safe. There is a pricing bubble here, but that's for different reasons. And renting here is nowhere near as cheap as this person says. They said it would take 114 years to pay back the cost of a house compared to renting. In the US, rent is usually slightly more or even much more than a mortgage and goes up over time, so your worst case scenario is less than 30 years.
Yes. One reason why new housing in the US is expensive is because there are way more regulations now than there were years ago. Houses now are much safer and built better. But that makes them more expensive.
Tell me about it. I'm in the middle of construction right now, and the various hoops I've had to jump through and mazes of codes I've had to navigate are insane. And it all makes things so much more expensive. And the number of inspections and permit plan check meetings I've had to do has taken so much of my time.
I probably shouldn't have tried to GC this myself.
Remember that all of those regulations are for a reason. Sometimes the reason is "contractors donated money to an elected official, but it's usually a good result. It's better to have higher quality than lower.
G'Day from the land down under of dogshit-quality housing-bubble-overpriced new builds. God I love how much money corporations are making.
Seriously, that describes what I've seen in the housing market these days to a T
The construction quality is… shall we say, not great. Pretty sure lots of it would not pass code in the states - let alone Europe, Korea, or Japan.
That's okay, I don't think we have teleportation technology yet anyway.
Hm. That didn't work out too well. Maybe they could switch over their economy to be based on tulip bulbs? That's bound to work forever.
In a communist state, why are unsold homes an issue? Why not just re home the millions living in bad conditions?
it's because China is a capitalist country with a capitalist economy.
This is the best summary I could come up with:
Since the real estate sector was sent into a tailspin in 2020, caused by the pandemic and a sudden regulatory crackdown, the industry that has traditionally powered about one-quarter of GDP has been in a downward spiral that policymakers have struggled to halt.
The crux of the problem is that, with shaky faith in the economy and big property developers failing to deliver on paid-for apartments, potential homebuyers are keeping their money out of the market.
Tao Ling, an official with the PBOC, said that local state-owned enterprises would be encouraged to use the funds to buy “reasonably priced” homes and turn them into affordable accommodation.
“While these local players are desperate to prove they can continue to deliver growth, they will be struggling with other priorities and unwilling to add to their debt obligations for investments that won’t provide any long-term profits.”
The authorities “know there isn’t really market demand” for the acres of unsold property, says Alicia García-Herrero, the chief economist for Asia Pacific at Natixis, an investment bank.
García-Herrero expects that there will be more fiscal reform to boost the impact of the policy, likely at the long delayed meeting of the Chinese Communist party’s central committee in July.
The original article contains 958 words, the summary contains 202 words. Saved 79%. I'm a bot and I'm open source!
Can't they just give the homes to people to fulfill their Communist agenda?
A community for discussing events around the World
Rule 1: posts have the following requirements:
Rule 2: Do not copy the entire article into your post. The key points in 1-2 paragraphs is allowed (even encouraged!), but large segments of articles posted in the body will result in the post being removed. If you have to stop and think "Is this fair use?", it probably isn't. Archive links, especially the ones created on link submission, are absolutely allowed but those that avoid paywalls are not.
Rule 3: Opinions articles, or Articles based on misinformation/propaganda may be removed. Sources that have a Low or Very Low factual reporting rating or MBFC Credibility Rating may be removed.
Rule 4: Posts or comments that are homophobic, transphobic, racist, sexist, anti-religious, or ableist will be removed. “Ironic” prejudice is just prejudiced.
Posts and comments must abide by the lemmy.world terms of service UPDATED AS OF 10/19
Rule 5: Keep it civil. It's OK to say the subject of an article is behaving like a (pejorative, pejorative). It's NOT OK to say another USER is (pejorative). Strong language is fine, just not directed at other members. Engage in good-faith and with respect! This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban.
Rule 6: Memes, spam, other low effort posting, reposts, misinformation, advocating violence, off-topic, trolling, offensive, regarding the moderators or meta in content may be removed at any time.
Rule 7: We didn't USED to need a rule about how many posts one could make in a day, then someone posted NINETEEN articles in a single day. Not comments, FULL ARTICLES. If you're posting more than say, 10 or so, consider going outside and touching grass. We reserve the right to limit over-posting so a single user does not dominate the front page.
We ask that the users report any comment or post that violate the rules, to use critical thinking when reading, posting or commenting. Users that post off-topic spam, advocate violence, have multiple comments or posts removed, weaponize reports or violate the code of conduct will be banned.
All posts and comments will be reviewed on a case-by-case basis. This means that some content that violates the rules may be allowed, while other content that does not violate the rules may be removed. The moderators retain the right to remove any content and ban users.
News !news@lemmy.world
Politics !politics@lemmy.world
World Politics !globalpolitics@lemmy.world
For Firefox users, there is media bias / propaganda / fact check plugin.
https://addons.mozilla.org/en-US/firefox/addon/media-bias-fact-check/