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So you are convinced that those empty apartments are actually a rational, planned investment that will be useful in the future, and not just a classical misallo

So you are convinced that those empty apartments are actually a rational, planned investment that will be useful in the future, and not just a classical misallocation of money? I have seen the results of a previous real estate bubble in Spain. Plenty of homes in weird locations, slowly falling apart, never occupied, some never even finished. As the local left said: "People without homes, homes without people". I am not a leftist, but they were onto something here.

jeffbee 3y ago
Spain is a disorganized basket case. China has a way to execute on their plans: they build a city and then the force people to move in. The most obviously successful is Pudong New Area, which in the 90s was just as empty as any other. Now it has a nation-sized GDP.
- inglor_cz 3y ago
  Chinese demography has changed a lot in the last 30 years. The young population is shrinking fast. I don't think they have enough people to fill so many apartments anymore.
  - jeffbee 3y ago
    Since 1992 when the "ghost cities" meme began China gained 300 million people and it is still growing.
    - inglor_cz 3y ago
      China is no longer growing and actually lost 2 million people year-to-year recently. Given that it is mostly the younger cohort that seeks new housing - older people tend to settle somewhere for the rest of their lives - I don't really see the demand picking up again.
      - maxglute 3y ago
        PRC is still urbanizing ("growing"). Old people from rural PRC gets "resettled". PRC trying to urbanize from 65%->80%/85%. They're going to have to if they want any services anyway. Most of the excess housing just right outside of cities. That's 200-300m people that still needs urban dwellings. Current excess square footage enough 100-150m people, about 10 years of headroom. This is without accounting for deprecated housing stock. Yes reality of speculation and (mis)allocation is much messier, but PRC is still 100-150m short on urban housing. For reference 80% urbanized US is short on ~6M homes, that's 2% relative to population. PRC is short 7-10% relative to urbanization targets and popluation.
        jeffbee 3y ago
        100%, thanks for writing it down. You'll also want to keep in mind that aging nations continue to require more homes even as their populations shrink.

jeffbee 3y ago

Spain is a disorganized basket case. China has a way to execute on their plans: they build a city and then the force people to move in. The most obviously successful is Pudong New Area, which in the 90s was just as empty as any other. Now it has a nation-sized GDP.

inglor_cz 3y ago
Chinese demography has changed a lot in the last 30 years. The young population is shrinking fast. I don't think they have enough people to fill so many apartments anymore.
- jeffbee 3y ago
  Since 1992 when the "ghost cities" meme began China gained 300 million people and it is still growing.
  - inglor_cz 3y ago
    China is no longer growing and actually lost 2 million people year-to-year recently. Given that it is mostly the younger cohort that seeks new housing - older people tend to settle somewhere for the rest of their lives - I don't really see the demand picking up again.
    - maxglute 3y ago
      PRC is still urbanizing ("growing"). Old people from rural PRC gets "resettled". PRC trying to urbanize from 65%->80%/85%. They're going to have to if they want any services anyway. Most of the excess housing just right outside of cities. That's 200-300m people that still needs urban dwellings. Current excess square footage enough 100-150m people, about 10 years of headroom. This is without accounting for deprecated housing stock. Yes reality of speculation and (mis)allocation is much messier, but PRC is still 100-150m short on urban housing. For reference 80% urbanized US is short on ~6M homes, that's 2% relative to population. PRC is short 7-10% relative to urbanization targets and popluation.
      - jeffbee 3y ago
        100%, thanks for writing it down. You'll also want to keep in mind that aging nations continue to require more homes even as their populations shrink.