On Friday, May 1st (2015), the following words appeared in a corner of the front page of the Financial Times:
"Something is wrong when a 1,000 sq m McMansion overlooking a rubbish-strewn wasteland in suburban Beijing has the same $8m price tag as a whole Caribbean island."
But one example does not prove that something is wrong with the market. Below are several illuminating perspectives on China's property market:
Recent Peterson Institute analyses
Sean Miner: Trends in China’s Property Market
Kent Troutman: Property as an investment class in China
Sean Miner: China’s Commercial Property Market
Ryan Rutkowski: China Has Property Taxes, Just Not The Right Ones
Kent Troutman: China’s Property Correction in Historical Perspective
Distribution of 5-year real housing price changes for 23 countries (1975 – 2014)
Source: Troutman (PIIE) & FRB Dallas, BIS
Real estate reporting
Chinese Housing Market Shakes Off a Slump - The New York Times: "Prices for new homes in the country’s biggest cities are rising sharply, led by the southern boomtown of Shenzhen, where prices jumped a staggering 62 percent in March, compared with the same period a year earlier, according to official data released on Monday."
Shanghai hits real estate brokers with month-long mortgage ban | South China Morning Post: "Move aimed at tackling demand but authorities should expand land supply, insider says"
Online Property Companies Soar on China's Real Estate Recovery - Bloomberg "Real estate Web portals Leju Holdings Ltd. and SouFun Holdings Ltd. are standing out among U.S.-traded Chinese stocks, rebounding as government stimulus and a recovering property market improves the outlook for growth."
Gillian Tett: "Recent environmental studies suggest that about “40 per cent of carbon emissions currently come from buildings”, or so he told me over lunch earlier this month. Meanwhile, “roughly half of new buildings going up in the world [now] are going up in China”, [Paulson] continued, because of the breathless pace of development. Thus, if only the world could persuade China to construct those new buildings in an energy-efficient way, we might have the means to reduce global warming. Or, to put it another way, if you want to make the world more green, targeting the way that China constructs its buildings might be more effective than endlessly fretting about buildings in countries where the structures are already built."