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It was broader than subprime and derivatives even. It was a general real estate (housing) bubble. Home prices became massively inflated and the various investme
by slantedview 11y ago
It was broader than subprime and derivatives even. It was a general real estate (housing) bubble. Home prices became massively inflated and the various investments tied to housing came crashing down. A similar result can be expected in China when the music eventually stops.
- yueq 11y agoWhen price go up it doesn't mean a it's a bubble. Getting loans is way harder/regulated in China than 06/07 US. Currently 25+% down payment or 70% for 2nd home is required. -- Comparing in 2007 banks only asks for 3% down.
- viblo 11y agoChina have aggressively lowered the requirements the last years. At the moment it should be 20% for first and 30% for 2nd home. Still some way to go for US levels ofc. www.mingtiandi.com/real-estate/china-real-estate-research-policy/china-lowered-downpayments-but-will-it-help-sell-homes-in-the-hinterland/
- slantedview 11y agoPrices going up for no good reason (increase in demand or decrease in supply) means there is a bubble. This is what happened in the US. Bubbles are the cause of speculation, such as building cities that sit empty.
- shostack 11y agoAny thoughts on what that will mean for the US real estate market given continued Chinese investment here? My current guess is we'll see more money pour in as people attempt to shelter their Chinese funds.