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We first commented on China’s new income inequality plan back in November when there was still a bit of skepticism over whether it would be released at all (it has been in the works since 2004). The initial outline of the plan was released this week in a notice (CN) by the State Council. The [...]
Land reform is one of the most politically sensitive topics in China and it has direct implications for both the real estate market and local government finances. In late November the Chinese State Council passed a draft amendment to the Land Administration Law (CN). The changes are aimed at boosting compensation for farmers whose land [...]
The third quarter GDP number for China was released today, showing a decline in growth to 7.4 percent (compared to 9.1 percent a year ago). Instead of a long post reiterating all the factors at play, sometimes a chart or two can sum things up succinctly. Here are the two most important graphs for understanding the [...]
It’s an article of faith amongst many analysts that China’s rapid urbanization will inevitably suck up any excess housing supply and boost consumption as new urbanites enter the middle class. For example, a new research report by the Reserve Bank of Australia begins with the following assertion: In 2011, 1.9 billion square meters of residential [...]
The Survey and Statistics Department at the People’s Bank of China (PBoC) has once again proven itself to be a source of interesting new policy ideas to deal with China’s economic problems. The report, Factors Behind Germany’s Economic Resurgence and Lessons for China (CN), outlines several policy prescriptions used by Germany that have relevance for [...]
The recent downturn in economic growth in China has led to a renewed focus on the sustainability of the Chinese model. China is commonly described as following an export-led growth model, yet for at least the past few years this has not been true. It has been investment, rather than exports, that has driven growth [...]
China’s extraordinary real estate boom may finally be over. Multiple indicators suggest that China is on the precipice of a significant market correction. Prices are down in more than half of the 70 cities surveyed by National Bureau of Statistics. Beyond price data (which is subject to some skepticism), residential floor space under construction, residential [...]
The Chinese housing market is clearly undergoing a correction that may eventually bring housing prices back to a more reasonable level. As the past several years have made all too apparent, housing downturns are economically painful and can lead to larger economic crises. The network of financial leverage that fueled the US housing bubble turned [...]
China’s affordable housing program is considered by many to be a ray of hope in what is otherwise a bleak property market. CLSA’s China Macro Strategist Andy Rothman was memorably quoted as being completely convinced that the Chinese government was “going to spend a hell of a lot of money on affordable housing.” The affordable [...]
The housing market correction we analyzed in November continues apace, but it appears to still be in the very early stages. Tightening measures, first implemented in early 2010, are slowly reducing super-elevated levels of housing investment and forcing developers to lower their prices to clear inventory. One of the most important trends underway [...]