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I've always wondered about this as well. Heavy investments in new cities, when there was no demand for them, just for the sake of "increased growth" was always
by mikeg8 11y ago
I've always wondered about this as well. Heavy investments in new cities, when there was no demand for them, just for the sake of "increased growth" was always a red flag to me. Interested in any correlation.
- ycombobreaker 11y agoI don't have any direct sources for this, but the word that I heard from a friend who spent some time in China recently was the following: - Chinese investors have limited places to park their cash. Stock market and real estate are two major options, and real estate is seen as a superior investment (stock market has... problems, you could say) - Chinese law prevents purchasing property without developing it. - Real estate investments therefore require barebones property development--regardless of tenancy--in order to remain legitimate. Therefore, "ghost towns" are a natural outcome of Chinese investment in Chinese growth. They can remain vacant for a long time and still satisfy the investment goals of the developer. (edit: list formatting)