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A Fifth of China’s Homes Are Empty (2018)

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Re: A Fifth of China’s Homes Are Empty (2018)

#121

Post by [deleted] »

spyckie2 wrote: post #80
ksec wrote: post #66

To put things into context. 1. These are Urban Homes. 2. There are roughly 20M people jumping to new cities and Urban areas every year. For years China has keep a roughly two years buffer zone, I think the rate of new housing is the same and rate of people going into Urban has declined, so a slight increase in terms of buffer ( closer to three years now ). 3. Most of the "Ghost Cities" do get fill up quickly, once th…

Articles about ghost cities are a fascinating read - sometimes exploring un-intuitive facts, like having 50m empty homes in China, yields a surprising discovery of the underlying systems. In this case, I think the system perfectly justifies having 50m homes empty. If you look at it another way, if San Francisco (arguably another booming localized economy) had the same initiative to build a 20% buffer for housing, it…

[deleted]

Re: A Fifth of China’s Homes Are Empty (2018)

#122

Post by spyckie2 »

james_s_tayler wrote: post #97
spyckie2 wrote: post #81

Earlier quoted context omitted.

"developing country" is a term used in economic discourse to mean something rather specific -> https://en.wikipedia.org/wiki/Developing_country . It has pretty specific criteria what qualifies, and America (the richest country in the world) does not.

Yes. And I think it's dumb. The article linked to states it in alternative words "low and middle income country LMIC". I think that's an order of magnitude better. I know I'm nitpicking and being an asshole about this point, but I think words matter. How we talk about things feeds in to how we conceptualize things and our mental models are like low quality, compressed, cartoon versions of reality and getting them mor…

Communication is nuanced, not my fault that words have a commonly accepted definition even if it has unexpected connotations attached.

Understand the frustration though.

Re: A Fifth of China’s Homes Are Empty (2018)

#123

Post by setgree »

In 2012, I traveled for about 6 weeks in China. I saw a lot of large cities -- not the megalopolises of Beijing and Shanghai but Guangzhou, Xi'an, Kunming -- with unreal amounts of what looked like high-end real estate going up. if you moved to the countryside, things got a lot poorer, so there was a pretty clear disconnect.

But the weirder thing was endlessly empty malls. For whatever reason, high-end luxury malls had all been built _before_ the in-progress housing stock, and they had already found tenants who were stores way out of my (comparatively wealthy!) price range: gucci, prada, etc.

So it seemed like the plan was to move a lot of people from the country to the city and provide them with high-end malls to shop at. But the problem was that those people were poor. It struck me as unlikely that they'd be rich enough to buy Fendi bags by the time they moved in. And the malls were standing dead empty until that happened.

None of this made any sense, and it was happening on an absurdly huge scale. (I can't remember where I read this, but I like the line that went like: "There is no precedent for how big things are in China, because there's never been anything as big as China.")

This seemed like a phenomenal misallocation of resources, so it was -- and is -- very hard to believe that a country making such crazy decisions was actually going to become wealthy and stable.

So pretty much everything I read about China's economic development, I don't believe. It all seems like a house of cards. Articles like this one, however, are much easier to grok.

Re: A Fifth of China’s Homes Are Empty (2018)

#124

Post by masonic »

BurningFrog wrote: post #104
pascalxus wrote: post #83

Earlier quoted context omitted.

SF residents are nowhere near rich enough to afford the struggles. Even people in the top 2-5% struggle desperately to afford housing, renting out every bedroom in the house just to afford to stay there.

SF residents are among the richest in the world. SF housing is made extremely expensive by multi decade long anti housing policies, but that's completely artificial. If the Chinese ran housing in SF, there would be housing for 5 million people there.

  If the Chinese ran housing in SF, there would be housing for 5 million people there
...and enough water for about 900,000 of them.

Re: A Fifth of China’s Homes Are Empty (2018)

#125

Post by pjc50 »

BurningFrog wrote: post #104
pascalxus wrote: post #83

Earlier quoted context omitted.

SF residents are nowhere near rich enough to afford the struggles. Even people in the top 2-5% struggle desperately to afford housing, renting out every bedroom in the house just to afford to stay there.

SF residents are among the richest in the world. SF housing is made extremely expensive by multi decade long anti housing policies, but that's completely artificial. If the Chinese ran housing in SF, there would be housing for 5 million people there.

Yes, they'd have demolished all of the old housing and it would look very different.

Re: A Fifth of China’s Homes Are Empty (2018)

#126

Post by dragonsh »

ksec wrote: post #66

To put things into context. 1. These are Urban Homes. 2. There are roughly 20M people jumping to new cities and Urban areas every year. For years China has keep a roughly two years buffer zone, I think the rate of new housing is the same and rate of people going into Urban has declined, so a slight increase in terms of buffer ( closer to three years now ). 3. Most of the "Ghost Cities" do get fill up quickly, once th…

I don't know where you got your statistics most are false, half complete or misleading. Even in place like Shanghai, its been around 15 years they built Lingang City is still empty, now waiting for Tesla factory to populate, govt spend over 38 billion dollars to build it, people bought apartment blocks seating empty or acting as construction workers living quarters.

Go to a mall right next to Huangpu river near Lupu bridge mostly empty for last 10 years built by Greenland (it's the main downtown area). As others pointed out most of these homes and commercial ventures are waiting for price rises to sale and are seating empty. This narrative of urbanization is pretty old, now it's impact is very little in city like Shanghai.

At present across China there is price but no buyers. People are holding on to real estate until they get atleast bit more than what they bought. On the other hand people's saving has already been consumed by SOE and govt spending. So the only way to prop up economy is to print money like USA. As long as other countries do not want RMB to depreciate, they can print money and prop up the economy.

Re: A Fifth of China’s Homes Are Empty (2018)

#127

Post by lazypenguin »

setgree wrote: post #123

In 2012, I traveled for about 6 weeks in China. I saw a lot of large cities -- not the megalopolises of Beijing and Shanghai but Guangzhou, Xi'an, Kunming -- with unreal amounts of what looked like high-end real estate going up. if you moved to the countryside, things got a lot poorer, so there was a pretty clear disconnect. But the weirder thing was endlessly empty malls. For whatever reason, high-end luxury malls h…

I found a similar reality in other developing countries. 1 hour outside of Dubai you can find giant luxury apartment blocks & chalet communities with 50% occupancy of basically only foreigners. A nearby deserted mall that is stock full of the top brands of everything and anything at top-dollar (literally) but just outside the "locals" live in abject poverty and work in the 50C sun. I have also seen in it Uzbekistan where a newly invigorated government rushes to throw up skyscrapers and luxury apartment complexes that nobody can afford while the local populations still lives in soul-crushing conditions.

My theory is that many developing countries use the wrong metric to gauge their success, looking to count their skyscrapers or their advanced techno-cities but fail to see that the success of "developed" countries lies more in their justice and governance systems.

Re: A Fifth of China’s Homes Are Empty (2018)

#128

Post by baybal2 »

Arn_Thor wrote: post #84
ksec wrote: post #66

To put things into context. 1. These are Urban Homes. 2. There are roughly 20M people jumping to new cities and Urban areas every year. For years China has keep a roughly two years buffer zone, I think the rate of new housing is the same and rate of people going into Urban has declined, so a slight increase in terms of buffer ( closer to three years now ). 3. Most of the "Ghost Cities" do get fill up quickly, once th…

Very important point. A common way of measuring China's surplus housing stock is by "months of sales". Housing inventory actually peaked back in 2015 at nearly 28 months of sales. It's now back at late 2013 levels of a little over 23 months of sales. Nothing to be alarmed about, even if it rises a little.

That omits the fact that big amount of the "buffer" was unsold for way way more than a few years, and the most liquid part of the stock are the bespoken 1000sq metre luxury mansion apartments.

Re: A Fifth of China’s Homes Are Empty (2018)

#129

Post by Cthulhu_ »

setgree wrote: post #123

In 2012, I traveled for about 6 weeks in China. I saw a lot of large cities -- not the megalopolises of Beijing and Shanghai but Guangzhou, Xi'an, Kunming -- with unreal amounts of what looked like high-end real estate going up. if you moved to the countryside, things got a lot poorer, so there was a pretty clear disconnect. But the weirder thing was endlessly empty malls. For whatever reason, high-end luxury malls h…

For claiming to be high-end brands, the amount of Gucci, Swarovski, Prada et al shops really cheapen them as a brand.

I've seen similar stuff in vacation destinations in Turkey and Greece; poorly developed areas next to a road (think just bare rock and shrubs) with a super fancy looking fur coat shop. Fur coat shops, in 35+ degree C weather. I want to believe they get the odd rich Russian coming over from time to time, but TBH they're probably money laundering fronts.

Re: A Fifth of China’s Homes Are Empty (2018)

#130

Post by est31 »

lazypenguin wrote: post #127
setgree wrote: post #123

In 2012, I traveled for about 6 weeks in China. I saw a lot of large cities -- not the megalopolises of Beijing and Shanghai but Guangzhou, Xi'an, Kunming -- with unreal amounts of what looked like high-end real estate going up. if you moved to the countryside, things got a lot poorer, so there was a pretty clear disconnect. But the weirder thing was endlessly empty malls. For whatever reason, high-end luxury malls h…

I found a similar reality in other developing countries. 1 hour outside of Dubai you can find giant luxury apartment blocks & chalet communities with 50% occupancy of basically only foreigners. A nearby deserted mall that is stock full of the top brands of everything and anything at top-dollar (literally) but just outside the "locals" live in abject poverty and work in the 50C sun. I have also seen in it Uzbekistan w…

Indeed, probably the biggest advantage that our societies have to the rich elite of repressive countries is the justice and governance system.

The problem with being rich in one of those oppresive regimes is that you can get rich. But staying rich is much harder, because the moment you fall out of favor you will be disowned. This can change simply through a new clan taking over power and kicking out the old clan. In the capitalist west, this is much different.

I personally think the best place is where the intellectual elite chooses to live. E.g. in the early medieval ages, the church harassed a bunch of intellectuals for their "heathen" ideology (greek philosophy, sciences, etc). So they all moved to the middle east, causing a great period of prosperity. Socialism, similar thing here. Russia had so many great minds. Scientists, authors, poets. But many of them went to the west and are still doing it. Same for germany btw, here eastern Germany was a big hub of culture, e.g. Leipzig was renown for its books, but socialists harassed and hated every intellectual (even more than they harassed the general population), so many of them fled to the west, so many in fact that they had to build a wall to keep them in. The western part of germany greatly profited from this brain drain.

It's not dangerous to democracy if these autocrat regimes build luxury condos that nobody lives in. It's dangerous when they build luxury condos and the elite choses to live there. In our world which is so much dependent on science and engineering, they chose which country, which region inside a country, prospers and which doesn't, simply by chosing where they live.

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