Real estate in China
Real estate in China is developed and managed by public, private, and state-owned red chip enterprises. Currently the market is experiencing tremendous growth and the central government has implemented measures to tighten interest rates, increase deposit and impose restrictions.
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The Chinese property bubble was a real estate bubble in residential and/or commercial real estate in China. The phenomenon has seen average housing prices in the country triple from 2005 to 2009, possibly driven by both government policies and Chinese cultural attitudes.
- Tianjin High price-to-income and price-to-rent ratios for property and the high number of unoccupied residential and commercial units have been held up as evidence of a bubble. Critics of the bubble theory point to China's relatively conservative mortgage lending standards and trends of increasing urbanization and rising incomes as proof that property prices can remain supported.
Growth of the housing bubble ended in late 2011 when housing prices began to fall, following policies responding to complaints that members of the middle-class were unable to afford homes in large cities. The deflation of the property bubble is seen as one of the primary causes for China's declining economic growth in 2012.
2011 estimates by property analysts state that there are some 64 million empty properties and apartments in China and that housing development in China is massively oversupplied and overvalued, and is a bubble waiting to burst with serious consequences in the future. The BBC cites Ordos in Inner Mongolia as the largest ghost town in China, full of empty shopping malls and apartment complexes. A large, and largely uninhabited urban real estate development has been constructed 25 km from Dongsheng District in the Kangbashi New Area. Intended to house a million people, it remains largely uninhabited. Intended to have 300,000 residents by 2010, government figures stated it had 28,000.
Welfare housing system, parallel dynamics, and allegations of corruption
As of 2010, China has officially ordered an end to its welfare housing system; however, according to China Youth Daily, a parallel housing market continues to exist. Government agencies continue to pay less than 20% of market value for real estate, and many officials purportedly misappropriate renovation and housing reform funds for personal gain.
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the popping of China’s real estate bubble over the past year depressed demand for steel, cement and other materials
- Bradsher, Keith (2012-06-09). "Affirming Slowdown, China Reports Second Month of Scant Economic Growth". New York Times. Retrieved 11 June 2012.
China’s leaders deliberately popped a real estate bubble last summer because of concerns that middle-class families had been priced out of homeownership in many cities
- China's Ghost Cities. Dateline SBS. Retrieved 17 August 2012.
- "Ordos: The biggest ghost town in China". BBC. 17 March 2012. Retrieved 17 August 2012.
- "Ordos, China: A Modern Ghost Town". Time. 25 March 2010. Retrieved 17 August 2012.
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- Bishop, Bill (2010-04-30). "China State Media On Corruption And Cooling Off The Real Estate Market". Sinocism. Retrieved 2010-05-03.
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- "2009 Q4 Financial Report" (PDF). SOHO China. 2010-03-11. p. 4. Retrieved 2010-03-18.
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