patrick.net

It ain't coming to US where prices are not possible to speculate into. Speculation was easy when anyone could pay absolutely nothing to get into the game, by signing pretend income, it is an entirely different gig when one has to give an arm and a leg and a newborn baby just to purchase a SFH.

They will probably speculate into another type of industry, unrelated to housing. I really think it will be tech, because of how much effort GS has been putting in lately to allow "liar IPO's".

Chinese house price is not "speculated". It is controlled by the government.
Tier 1 cities (such as Beijing and Shanghai) are set to be just like New York City or any other world class major cities.

The idea is that Chinese will eventually make as much money as an American.
Selling it cheap now doesn't make any sense.

Unlike Americans, Chinese will not spend any money on a website. I don't think it can fool any Chinese. Maybe they can sell these stocks to Americans :)

xenogear3 says

Chinese house price is not “speculated”. It is controlled by the government.

That's a pretty bold statement. As stated, word for word, I believe this is incorrect. If you do not want to be perceived as vague, incorrect or ambiguous I suggest adding more detail.

Who are the entities of government that supposedly control housing transaction prices in China's Tier-1 cities? How do they do it?

xenogear3 says

Selling it cheap now doesn’t make any sense.

See what I mean? Selling by whom?

In China there is a real estate bubble. There are presently over 64 million empty apartments. The Chinese have bought them as investments, since they are limited as to where they may invest. They may buy 1. Class A shares of Chinese stocks 2. apartments 3. cash 4. gold.
Local government officials are in collusion with developers to keep building.
It's interesting to see.

The Chinese Government since the end of '07 have had their fingers plugged firmly in their ears, while screaming "LA, LA, LA, I'm not listening!"
I've been expecting this day, since 09 when I was in Asia, the Chinese government decreed that Americans were a bunch of whining cry babies, who didn't have the meddle to stomach market volatility. The Chinese were under the impression that today's lows are just a blip on the screen, where as today's lows sends Americans scurrying selling all of their stocks. Then went on to blame the world economic collapse, that happening across the globe unilaterally, on America. Because our premature manner we read and abandon the market.

It was an article in an Asian business journal, April 09 edition I was reading at the Eastin hotel.
It smacked of economic denial.

Then a few weeks ago there was footage floating around on the internet, of whole blocks upon blocks of metro urban developed areas, that were ghost towns. No on could afford to live in the buildings. Whole cities and town just sit vacant. This was video footage that was taken by a foreigner visiting Bejing.

So you see, even in China, a house is only worth what someone will pay.

And BTW, that is the reason the Chinese didn't swoop in and buy up all of America they were busy developing their White Elephant ghost towns.

But who knows, perhaps in the future, all of that urban economic development will be put to good use, they are a socialist country aren't they? There will come a point where people will be put in those dwellings regardless. Where as in the US, people are considering how can we destroy the over supply.
People living in the streets be damned.

The Chinese are also running stress tests on their banks under the condition of a 50% (yes, you read that correctly) crash in house prices.

Yea but they're allowing the banks to fudge their numbers of just how those losses are calculated and how many assets they have.

Its all a political game over there and fix is in if you're big enough, which the banks are. They have many of the same problems we do here now.

SF ace says

if chinese cannot speculate in china anymore, they’ll speculate somewhere else. check Hong kong and Singapore (obvious destinations) prices recently for where the money is heading. Some of it is heading elsewhere in the world.

They got their money to speculate from the Chinese gov. and gov. run banks. If their banks and gov. won't give them the cash and they can't sell their current properties into a declining market for a profit they won't be buying here or anywhere.

schmitz_kris says

The Chinese are also running stress tests on their banks under the condition of a 50% (yes, you read that correctly) crash in house prices.

But as we all know, "stress test", is newspeak and probably means treating the banks with kid gloves, just as is done here. I wager they are not so much conducting any real test as they are trying to signal to people to STOP bidding up property.

A reference to 50% stress test:

http://www.reuters.com/article/2011/04/22/china-property-bank-tests-idUSL3E7FL4G720110422

Nothing like a bunch of house-horny ex-communist to create the mother of all bubbles.

"Real housewives of Shanghai", anyone?

The video is here: Pretty interesting stuff going on over there. http://www.youtube.com/watch?v=rPILhiTJv7E&feature=player_embedded

I've been to one of those ghost towns not in Beijing but south china.
Very eerie and depresing like something out of the twilight Zone

Sort of like imitation of a big American city looks jut like it in photos but when your on the ground it's like where are all the people?

Should be titled "Cities and Malls to nowhere and for no one".

All they really need now is a full scale size clay Taracotta figures of the public.

Isn't Beijing one of the most polluted cities in the world? Why again would anyone want to live there?

StoutFiles says

Isn’t Beijing one of the most polluted cities in the world? Why again would anyone want to live there?

Los Angeles tops in the list of high smog cities still so many here that it is worth the high RE prices because weather is really nice!

bubblesitter says

StoutFiles says

Isn’t Beijing one of the most polluted cities in the world? Why again would anyone want to live there?

Los Angeles tops in the list of high smog cities still so many here that it is worth the high RE prices because weather is really nice!

Maybe you meant LA tops the list in the US. Because it's not even in the top 10 worldwide:

http://www.dailyfinance.com/2010/11/29/10-cities-with-worlds-worst-air/

Beijing is #1...