This 60 minutes segment describes the surge in construction throughout China. There are cities being built with miles and miles of empty apartments, condos, malls, and office buildings. A really interesting look at the potential housing bubble.
Link: http://www.cbsnews.com/video/watch/?id=50142079n
2 comments:
Not only are the assets vacant, but they used some the lowest cap rates in history to value them. If the assets ever start to produce income, it will not be nearly enough to recover the initial cost of investment.
Housing prices in China have skyrocketed, as has the amount of housing speculation in China. Add to this the low interest rate environment and you begin to get a picture of a nation that looks quite similar to the United States in '07. Could China be in for a crash? Only time will tell.
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