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Building several fold more home than there are people when your demographics are moving the other direction is called debt fueled trap.
by refurb 1y ago
Building several fold more home than there are people when your demographics are moving the other direction is called debt fueled trap.
- bryanlarsen 1y agoChina still has significant internal migration from rural areas to the cities. They're building houses in areas people want to move to.
- refurb 1y agohttps://www.reuters.com/world/china/even-chinas-14-bln-population-cant-fill-all-its-vacant-homes-former-official-2023-09-23/ https://www.reuters.com/world/china/even-chinas-14-bln-popul... "Even China's population of 1.4 billion would not be enough to fill all the empty apartments littered across the country, a former official said on Saturday, in a rare public critique of the country's crisis-hit property market." Now, housing gets old, people upgrade, so that supply will eventually be soaked up. But the debt overhang on local governments and indivudal Chinese is the killer. They've built up several years of housing supply and now get to pay for it all while it stays empty for a few years - plus the value is dropping. It's a massive drag on the economy as all that investment is locked up and unproductive.