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Commentary

Video: China's Ghost Cities and Malls

An incredible video by the Australian SBS DateLine on China. 64 million apartments are empty!

 

The empty malls and overconstruction seems just like Gurgaon’s Sohna Road or indeed much of the out-of-city developments in most metros. Sohna Road has like 10 malls, nearly all of them bare empty. Developers are holding on to price points like nobody’s business, and "investors" are waiting for the upmove.

If China drops, then India drops too. We will eventually blame it on an external event, because everyone inside is invested. What isn’t really accurately known is how levered our economy is on real estate.

  • Sambaran says:

    >Scary. Very scary. Provided of course that the reporter has not over dramatized the reality.

    Assuming that the video is honest, what saves (or does not save) India from such a predicament? Who are the owners of sohna-road-malls? Why do you say if china drops, India drops too?

  • Anonymous says:

    >What is the cost of the mall & the sale price ? i have a Chinese buyer for the same. Also give me their broker phone number. Depending on the commission i get I can help u sell it in the time desired.
    All businesses have a price. & Value decides the position of sale or purchase.

  • Deepak Shenoy says:

    >Sambaran: Sohna road malls have investments from corporates, Delhi HNIs, teh developers themselves.

    If China Drops, the bubble woudl have burst, which will create imbalances enough for India to follow.

    Anon: MagicBricks and 99acres are your friend 🙂

  • Mahendra says:

    >China I think has a big enough population and business activity to possibly cope with a few 'ghost malls'

  • Deepak Shenoy says:

    >Mahendra: True. Let's see how good or bad the situation turns out!

  • Anonymous says:

    >I dont agree with Mahendra.
    As shown in video, flats are very expensive so most of people are not able to buy these. While government is developing such cities at very fast pace. I dont think government will sell those flats at subsidised rates..
    You can see so many flats are sold in Noida ext. which is mostly bought as investment. Once these flats will be ready for delivery, most of ppl will try to sell it..
    Thoughts??

  • Deepak Shenoy says:

    >Anon: Agree with the Noida Extension example. Though people will hold prices for a long time!

  • Anonymous says:

    >It may happen or not.
    Most of these flats are owned by IT guys. Many of them booked 3-4 flats seeing the cheapness of flats. As cost of living, interest rates going here… and we never know when next recession cycle starts.. I dont think everyone will make profit there..

    Dheeraj