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Beijing Property Prices Down 30%


Alert Reader MK says:

How about a writeup on Beijing Commercial Property prices which have collapsed 30% in the last one month.

So I do the Google and find out:

We’ve been waiting for tightening measures to hit the Beijing property market, especially after the city’s real estate association itself said the situation was a bubble.

It looks like the government’s clampdown is starting to bite, hard. Average Beijing transaction prices collapsed 31% month on month:

They’re introducing further restrictions on property later this month, such as hiking taxes on owners of multiple properties, according to Shanghai Security News.

A China bubble bust is a problem for China, not so much for the rest of the world. But it just started to show signs of becoming more local as an economy compared to the 65% export economy it recently was. The localization may be under threat if there is deleveraging in the residential sector.

But honestly, I find it difficult to believe anything coming out of China. There, news is manipulated to tell us what they want us to hear. It could just be that the authorities are playing a game to try and cool off property values without, er, them actually cooling off. When it comes to China, all bets are off. They can get more sinister than any of the governments so far, and unlike the west, they aren’t in fiscal trouble and can easily do bailouts of gargantuan proportions if sentiment really gets bad. So it’s worth keeping an eye on, but definitely not worth trading on.


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