China Real Estate Unravels

[nwoodman]

 

Some interesting analysis by Chovanec

 

http://chovanec.wordpress.com/

 

"China’s developers are playing out a kind of prisoner’s dilemma:  rush to complete, in hopes of cashing out.  But while supply keeps going up, demand is going down.  In late March, a central bank (PBOC) survey reported that only 14.1% of Chinese consumers were looking to buy a house in Q2, the lowest level since 1999.  Only 17.7% expected home prices to rise in Q2, and 62.9% said they still consider prices to be too high.  So all those rushed completions only add to the glut already on the market, driving prices down further and giving buyers — investors and aspiring residents alike — all the more reason to hold off for a better deal."