3 ms·

Forest City, a $100B ghost town in Malaysia

16 points by stickfigure 4y ago

groffee 4y ago
They could single-handedly end homelessness in the country, no profit in that though.
- Proven 4y ago
anigbrowl 4y ago
I eagerly await the supply-and-demand explanation for why apartment prices remain at around 250x median annual income despite a 5% occupancy rate.
- FooBarBizBazz 4y ago
  I like to view supply/demand literally sometimes as an order book. And here we have a giant chasm of a bid-ask spread. I suppose you could even draw the supply and demand curves. They just... don't intersect!
- lotophage 4y ago
  Does everything require an overly simplistic supply and demand explanation? It is by design a prestige development that hopes to attract high worth foreigners. If they start pricing it so that locals can afford it, the value will tank because the riff-raff have been let in and the investors will be up in arms. I'm not saying that I like any of this, but it's a for-profit real estate development, not government funded social housing.
  - anigbrowl 4y ago
    Far be it from me to gainsay the Chicago school.
- c_o_n_v_e_x 4y ago
  They aren't buying a house... They're buying a means to move money out of China and clean it.
- Grimburger 4y ago
  > 250x median annual income Not sure where you got that number. Average salary in JB is about $25k a year. They are luxury apartments, a few km away from the border of Singapore for $140,000. Compare that to buying the equivalent over the causeway, would be a magnitude higher Many of them are owned, just not by people who want to live there. It's a place for Chinese people to park money in real estate. I have the same up north in Penang. For the first year there was no one else living on my floor and the block was basically empty despite nearly all of them being sold. Even a few years later looking at lights at night time I'd say under 40% occupancy of the building. The same for all other skyscrapers in the area, and looking out the window I can see 3 new buildings still going up. Prices here aren't skyrocketing at all. Actually going down in real terms because they just keep building and building. Zoom out and check out the housing index for the entire country: https://tradingeconomics.com/malaysia/housing-index https://tradingeconomics.com/malaysia/housing-index Supply is pushing prices down despite GDP going strong.
iancmceachern 4y ago
How does stuff like this happen. It's just so wasteful, and there are so many folks in Malaysia, and the world over, that could benefit from simple things like medicine or clothing.
c_o_n_v_e_x 4y ago
One of my neighbors said they have the nicest golf course he's ever played on.

16 points by stickfigure 4y ago

groffee 4y ago

They could single-handedly end homelessness in the country, no profit in that though.

Proven 4y ago

anigbrowl 4y ago

I eagerly await the supply-and-demand explanation for why apartment prices remain at around 250x median annual income despite a 5% occupancy rate.

FooBarBizBazz 4y ago
I like to view supply/demand literally sometimes as an order book. And here we have a giant chasm of a bid-ask spread. I suppose you could even draw the supply and demand curves. They just... don't intersect!
lotophage 4y ago
Does everything require an overly simplistic supply and demand explanation? It is by design a prestige development that hopes to attract high worth foreigners. If they start pricing it so that locals can afford it, the value will tank because the riff-raff have been let in and the investors will be up in arms. I'm not saying that I like any of this, but it's a for-profit real estate development, not government funded social housing.
- anigbrowl 4y ago
  Far be it from me to gainsay the Chicago school.
c_o_n_v_e_x 4y ago
They aren't buying a house... They're buying a means to move money out of China and clean it.
Grimburger 4y ago
> 250x median annual income Not sure where you got that number. Average salary in JB is about $25k a year. They are luxury apartments, a few km away from the border of Singapore for $140,000. Compare that to buying the equivalent over the causeway, would be a magnitude higher Many of them are owned, just not by people who want to live there. It's a place for Chinese people to park money in real estate. I have the same up north in Penang. For the first year there was no one else living on my floor and the block was basically empty despite nearly all of them being sold. Even a few years later looking at lights at night time I'd say under 40% occupancy of the building. The same for all other skyscrapers in the area, and looking out the window I can see 3 new buildings still going up. Prices here aren't skyrocketing at all. Actually going down in real terms because they just keep building and building. Zoom out and check out the housing index for the entire country: https://tradingeconomics.com/malaysia/housing-index https://tradingeconomics.com/malaysia/housing-index Supply is pushing prices down despite GDP going strong.

iancmceachern 4y ago

How does stuff like this happen. It's just so wasteful, and there are so many folks in Malaysia, and the world over, that could benefit from simple things like medicine or clothing.

c_o_n_v_e_x 4y ago

One of my neighbors said they have the nicest golf course he's ever played on.