A few big stories on China’s housing situation came out today
Confused About China? So Is Credit Suisse – WSJ China Real Time
Conflicts between economics teams and securities teams are pretty normal.
Chinese property *alert* – FT Alphaville
Jan-Feb stats are weird in China
I’m not yet impressed by any of this. China has an over-saturated high-end real estate market, and an under-saturated low-end market. The government has been fairly explicit about its attempts to bring down the price of housing, and it has been reinvesting a lot of its own money into affordable housing which should keep input prices buoyant. The major structural reasons for China’s real estate demand – rapid urbanization and the upgrading of older houses – is still going on.
It should also be noted that over-investment in high-end real estate and underinvestment in low-end real estate is a fairly normal phenomenon everywhere. The policy infrastructure China is trying to establish is relatively similar to what already exists in places like New York and San Francisco.