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Why is it seen as a better speculative investment than other opportunities. After all, someone is left holding the bag when the investment is found to be unuse

Why is it seen as a better speculative investment than other opportunities. After all, someone is left holding the bag when the investment is found to be unused -- which is a cost just as much as a tax would be. What other considerations are outweighing that cost?

lph 8y ago
Because property values have skyrocketed in big cities. Of course, that's no guarantee that they'll continue to rise, but, this history looms large in media and culture. Everybody knows somebody who became rich this way: "My classmate's parents bought him a condo in Beijing in 2008 and now it's worth millions!" There is also the continued migration from rural to urban, ensuring that demand will continue to increase for a while yet.
bobthepanda 8y ago
China controls how capital can leave the country. There is a lot of money just sloshing around within China hungry for investment. And the financial sector is relatively underdeveloped with a volatile stock market. As a result, Chinese money loves chasing bubbles in search of returns, like P2P lending and crypto.
barry-cotter 8y ago
http://scholars-stage.blogspot.com/2014/08/passages-i-highlighted-in-my-copy-of.html?m=1 http://scholars-stage.blogspot.com/2014/08/passages-i-highli... The entire Chinese economy is as rigged as the government can make it. The stock and bond markets are fake, the state owned enterprises are run as fiefs of the Party-State, not for profit, all the major banks included. Nothing is trustworthy. Combine that with a property market that’s been going up for decades and a ruling class that would not be happy if the middle class that started rioting if their savings in property went up in smoke and you have a fake property market too.
Chris_Jay 8y ago
One thing I found when looking into investing in Asia is that p/e ratios are... extreme.
- seanmcdirmid 8y ago
  Purchase to rent ratios are also extreme in china. Good investing is tough.

lph 8y ago

Because property values have skyrocketed in big cities. Of course, that's no guarantee that they'll continue to rise, but, this history looms large in media and culture. Everybody knows somebody who became rich this way: "My classmate's parents bought him a condo in Beijing in 2008 and now it's worth millions!" There is also the continued migration from rural to urban, ensuring that demand will continue to increase for a while yet.

bobthepanda 8y ago

China controls how capital can leave the country. There is a lot of money just sloshing around within China hungry for investment. And the financial sector is relatively underdeveloped with a volatile stock market. As a result, Chinese money loves chasing bubbles in search of returns, like P2P lending and crypto.

barry-cotter 8y ago

http://scholars-stage.blogspot.com/2014/08/passages-i-highlighted-in-my-copy-of.html?m=1 http://scholars-stage.blogspot.com/2014/08/passages-i-highli... The entire Chinese economy is as rigged as the government can make it. The stock and bond markets are fake, the state owned enterprises are run as fiefs of the Party-State, not for profit, all the major banks included. Nothing is trustworthy. Combine that with a property market that’s been going up for decades and a ruling class that would not be happy if the middle class that started rioting if their savings in property went up in smoke and you have a fake property market too.

Chris_Jay 8y ago

One thing I found when looking into investing in Asia is that p/e ratios are... extreme.

seanmcdirmid 8y ago
Purchase to rent ratios are also extreme in china. Good investing is tough.