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> 2. China is going through a weird demographic situation. The younger generations are significantly fewer in number, they will need fewer apartments to live in

by re-thc 3y ago

> 2. China is going through a weird demographic situation. The younger generations are significantly fewer in number, they will need fewer apartments to live in. That's not really the issue. I doubt the younger generation can afford it. The problem is where the wealth is going - as in those with the $$$. > The demand side is mostly people buying second and third units as investments. No, at least not always. At some point you weren't allowed to buy more than 1 or even use your funds openly this way. So to wrap up - those with wealth lost or have lost trust with China / the government and are withdrawing at alarming rates, e.g. to overseas. Due to how COVID was handled and many other cases where your wealth could just disappear - people now rather keep their $$$ elsewhere - not back "home".

mattbrewsbytes 3y ago
I think the demographics aren't in a "weird situation" ... they have significant population decline. Baby boomers is a generation across the planet with varying years in each region or country and generations behind them are smaller everywhere. China also had a 1 child policy for a long time so this has resulted in fewer people. Fewer people (smaller generation) having fewer people results in fewer people, which ... you get it. You can't create more 30-40 year olds right now. Massive real estate growth doesn't correlate with the population. Either people or companies are going to get stuck with the costs, I doubt the government is going to prop up the company.
- bobthepanda 3y ago
  China’s one child policy is actually even more dramatic because before that, Mao was telling everyone to have more kids, and it worked a little too well.
nradov 3y ago
Due to capital controls, most regular Chinese who lack CCP connections can't legally keep their savings "elsewhere". Speculative investments in residential real estate have been the only game in town.
- red-iron-pine 3y ago
  you don't need CCP connections to buy BTC under the table, or to buy houses in Canada. BTC valuations and fluctuations in price can be pegged to Xi's anti-corruption initiatives. Ditto for MBS taking over in Saudi. Lotta people were moving lots of money to other places and then GTFO. that may not help rando middle class earner in China in 2023 -- CCP is a little tigher these days... -- but realistically they don't have the need or ability to store stuff elsewhere regardless. 5k for a retirement fund isn't getting stored in a Bermuda bank, even if they could.

by re-thc 3y ago

mattbrewsbytes 3y ago

I think the demographics aren't in a "weird situation" ... they have significant population decline. Baby boomers is a generation across the planet with varying years in each region or country and generations behind them are smaller everywhere. China also had a 1 child policy for a long time so this has resulted in fewer people. Fewer people (smaller generation) having fewer people results in fewer people, which ... you get it. You can't create more 30-40 year olds right now. Massive real estate growth doesn't correlate with the population. Either people or companies are going to get stuck with the costs, I doubt the government is going to prop up the company.

bobthepanda 3y ago
China’s one child policy is actually even more dramatic because before that, Mao was telling everyone to have more kids, and it worked a little too well.

nradov 3y ago

Due to capital controls, most regular Chinese who lack CCP connections can't legally keep their savings "elsewhere". Speculative investments in residential real estate have been the only game in town.

red-iron-pine 3y ago
you don't need CCP connections to buy BTC under the table, or to buy houses in Canada. BTC valuations and fluctuations in price can be pegged to Xi's anti-corruption initiatives. Ditto for MBS taking over in Saudi. Lotta people were moving lots of money to other places and then GTFO. that may not help rando middle class earner in China in 2023 -- CCP is a little tigher these days... -- but realistically they don't have the need or ability to store stuff elsewhere regardless. 5k for a retirement fund isn't getting stored in a Bermuda bank, even if they could.