4 ms·

> affordable housing is in the interest of everybody except property developers. it is, but it's also complicated as the problems are quite a bit different in

> affordable housing is in the interest of everybody except property developers. it is, but it's also complicated as the problems are quite a bit different in China then in the US the reason there was a bubble in China was because they sold (barely) affordable (apartment owned, not rented) housing to a huge amount of people while not producing it. Like they financed it similar to a snowball system. Group B buys housing but pays for the housing bought by Group A then Group C pays for Group B etc. But at some point it fell apart and people realized the housing they should have gotten "soon" isn't being build (or stuck in a partial state) and the company has no money anymore. (Kind oversimplifying the whole thing.) To top that off there are (state build) ghost cities which have cheap appartments and acceptable building build quality, the problem is there is nothing there, no jobs(!), no supermarket, bus, people, "anything", if you are unlucky even electricity might be cut of in parts of it, (also I guess for rent not apartment ownership). (But there are also enough examples of western media reporting about ghost cities messed up because turns out just a few years later it wasn't a ghost city anymore.) And to make that worse it's not just Evergrande. It outside of the areas with a lot of central government focus there where many cases of houses building companies which had money issues trying to pretend everything is fine by cheeping out on building cost to a point where houses build that way are basically unusable. Through from the outside it looked like there is still progress. Issue with that is, it is really hard to guess how bad it is, pro-china media most times doesn't mention it and if it says it's a rare exception and/or videos are fake, anti-china media says it's bad to a point it's everywhere, and you find little in between. And both sides are known to lie a lot.

dpflan 3y ago
Very curious how these opportunities for housing were marketed to the masses? These ghost cities you describe, I can see how the new housing can be presented as a life-changing opportunity, with nice images/videos but the reality is...a ghost town, facade of a city.
- rfwhyte 3y ago
  They are marketed as investments, not housing. The majority of people buying these "Homes" never intended for themselves or anyone else for that matter, to live in them in the first place.
- citrusybread 3y ago
  China is still urbanizing rapidly. Just like GP said, it won't be a ghost city for long. It depends though on how long the investor can hold out, and whether or not the new city is doomed from the start. CCP planning is just different. TBD if it's doomed to fail like the Soviet Union, or if it will make it through a crisis like this. It's also hard to tell what will ultimately call a crisis; just thinking back to 2008, a lot of the story is only figured out in retrospect (eg how critical Bear Stearns was).
  - berserk1010 3y ago
    > China is still urbanizing rapidly. Many things wrong with that statement. There is a reverse migration from cities back to countryside, since the wages in the city have fallen, jobs have disappeared, rent is still expensive, and it's harder to justify living in the city when you can only save a few hundred dollars a year from a job. Thus, empty retail stores in major tier 1 cities. Empty apartments in Dongguan and Shenzhen. Small crowds at malls.
    - dathinab 3y ago
      From what I heard that is a somewhat "recent" trend while most ghost city cases I heard of outdate that trend by month potential over a year. I think a lot of people living in the west without ties to china haven't realized that there are many huge but sometimes subtle changes in China in the last view years.
      - seanmcdirmid 3y ago
        > while most ghost city cases I heard of outdate that trend by month potential over a year. Isn't that like the people who claim that huge sky scraper in Tianjin will be finished any day now? https://en.wikipedia.org/wiki/Goldin_Finance_117 https://en.wikipedia.org/wiki/Goldin_Finance_117 Kangbashi is up to 100k now, at least, but they designed for a million, so it is still pretty empty. As soon as coal becomes big again, maybe it will fill up.
    - Syntaf 3y ago
throwaway4aday 3y ago
Ghost cities are a good example of how simply building housing is not a perfect solution. If the housing is somewhere where people don't want to be then it is worthless and also useless since no one can make use of it if they can't make a living there.
- hakfoo 3y ago
  The Ghost City concept is actually a great one, but it has the "you opened the bedroom door while someone is dressing" visuals problem. If you can plan and work on a longer term, you can do things like staging multiple phases of development. They can build the subway station that opens up into a dismal swamp today, and watch the YouTubers laugh. But in 3 years the swamp is scheduled to be paved, in 6 years there will be 10,000 housing units in walking radius, and in 10 years, the Work Factory will have opened nearby and you have a sprawling community of 60,000 people surrounding a subway station that would be logistically difficult and expensive if you tried to build it in after the fact.

dpflan 3y ago

Very curious how these opportunities for housing were marketed to the masses? These ghost cities you describe, I can see how the new housing can be presented as a life-changing opportunity, with nice images/videos but the reality is...a ghost town, facade of a city.

rfwhyte 3y ago
They are marketed as investments, not housing. The majority of people buying these "Homes" never intended for themselves or anyone else for that matter, to live in them in the first place.
citrusybread 3y ago
China is still urbanizing rapidly. Just like GP said, it won't be a ghost city for long. It depends though on how long the investor can hold out, and whether or not the new city is doomed from the start. CCP planning is just different. TBD if it's doomed to fail like the Soviet Union, or if it will make it through a crisis like this. It's also hard to tell what will ultimately call a crisis; just thinking back to 2008, a lot of the story is only figured out in retrospect (eg how critical Bear Stearns was).
- berserk1010 3y ago
  > China is still urbanizing rapidly. Many things wrong with that statement. There is a reverse migration from cities back to countryside, since the wages in the city have fallen, jobs have disappeared, rent is still expensive, and it's harder to justify living in the city when you can only save a few hundred dollars a year from a job. Thus, empty retail stores in major tier 1 cities. Empty apartments in Dongguan and Shenzhen. Small crowds at malls.
  - dathinab 3y ago
    From what I heard that is a somewhat "recent" trend while most ghost city cases I heard of outdate that trend by month potential over a year. I think a lot of people living in the west without ties to china haven't realized that there are many huge but sometimes subtle changes in China in the last view years.
    - seanmcdirmid 3y ago
      > while most ghost city cases I heard of outdate that trend by month potential over a year. Isn't that like the people who claim that huge sky scraper in Tianjin will be finished any day now? https://en.wikipedia.org/wiki/Goldin_Finance_117 https://en.wikipedia.org/wiki/Goldin_Finance_117 Kangbashi is up to 100k now, at least, but they designed for a million, so it is still pretty empty. As soon as coal becomes big again, maybe it will fill up.
  - Syntaf 3y ago

throwaway4aday 3y ago

Ghost cities are a good example of how simply building housing is not a perfect solution. If the housing is somewhere where people don't want to be then it is worthless and also useless since no one can make use of it if they can't make a living there.

hakfoo 3y ago
The Ghost City concept is actually a great one, but it has the "you opened the bedroom door while someone is dressing" visuals problem. If you can plan and work on a longer term, you can do things like staging multiple phases of development. They can build the subway station that opens up into a dismal swamp today, and watch the YouTubers laugh. But in 3 years the swamp is scheduled to be paved, in 6 years there will be 10,000 housing units in walking radius, and in 10 years, the Work Factory will have opened nearby and you have a sprawling community of 60,000 people surrounding a subway station that would be logistically difficult and expensive if you tried to build it in after the fact.