• Monday, January 27, 2020

China’s ‘Golden Era’ for Property Over

Discussion in 'China & Far East' started by Lux de Veritas, May 29, 2014.

  1. Lux de Veritas

    Lux de Veritas BANNED

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    Good news. Chairman Xi is doing something his job against parasitic non-productive and rent seeking landlords. If Chairman Xi is able to follow through his measures and if China property price falls to the level of 2-3 years annual disposable income, it will usher a golden age in China

    China’s ‘Golden Era’ for Property Over, Vanke President Says - Bloomberg

    The “golden era” for China’s property market has passed, according to China Vanke Co. (000002), the nation’s biggest developer, which is shifting its focus to homes for owner occupiers rather than investors.

    “The period in which everybody makes money out of property is gone,” President Yu Liang told reporters May 26 in Dongguan, a southern city in Guangdong province. “Vanke will take a cautiously optimistic approach to face the slowdown and target those buyers who need homes for self-use.”

    The housing market threatens Premier Li Keqiang’s efforts to put the brakes on a slowdown in the world’s second-largest economy that is projected to grow at the weakest pace since 1990. Moody’s Investors Service revised its credit outlook for Chinese developers to negative from stable last week, while home sales slumped 10 percent in the first four months of this year amid tight credit, reversing last year’s 27 percent jump and prompting developers including Vanke to cut prices.

    “He should have seen some signs since it’s indeed difficult to make money now compared with before,” said Dai Fang, a Shanghai-based analyst at Zheshang Securities Co. “Growth we’ve seen before is no longer possible and you won’t be seeing blossoms everywhere again,” he added, using a Chinese idiom to refer to the property boom seen in every city.

    Price Cuts

    Pressure on Chinese developers was underscored by the collapse of a developer in a city south of Shanghai in March. Moody’s forecasts year-on-year home sales growth will slow to at most 5 percent in the next 12 months, from 27 percent last year. Yu said China’s real estate market is still big enough and Vanke will keep residential property as its main business over the next 10 years.

    The value of new homes sold in 2013 rose 27 percent from 2012 to 6.8 trillion yuan ($1.1 trillion), according to the National Bureau of Statistics.

    While the company has offered promotions, including discounts for group purchases, “cutting prices will not solve every problem unlike in the past because that won’t help sales of some high-end homes,” Yu said. Developers including Vanke and Greentown China Holdings Ltd. have cut property prices since March to lure homebuyers, according to China Real Estate Information Corp.

    ‘Big Brother’

    Vanke is interested in investing in industrial property and homes for the elderly, Yu said.

    China’s new-home prices rose in April in the fewest cities in a year and a half, while home sales fell 18 percent from March, according to government data.

    “The market is far from its big turning point,” Vanke’s board secretary, Tan Huajie, said at the same briefing. “As the big brother in the industry, we are responsible to alert risks, but it doesn’t mean we are bearish on the property market.”

    The growth in the real estate industry will slow and the phase where “whoever buys makes money” is gone, even as the nation’s accelerating urbanization still promises bright prospects for the market, Vanke Chairman Wang Shi told Caixin, a financial news company, in an interview last month.

    New construction has fallen 22 percent and sales, including commercial real estate, have slumped 7.8 percent this year.

    While 12 of 18 economists say China has some oversupply of housing, only seven say the market is in a bubble state countrywide, according to a survey conducted from May 15 to May 20 by Bloomberg News. Half see a bubble in some cities, and a majority say the loosening of restrictions on home purchases and loans will be limited to a regional level.
     
  2. cnleio

    cnleio ELITE MEMBER

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    My only wish, is Mr Xi can put down current China house price. Now in some 1st-line big cities the price over 3000 or 4000 U.S dollar/m2 ( BeiJing/ShangHai/GuangZhou/ShenZhen over 4000 to 10,000 U.S dollar/m2, F@CKING CRAZY ! ), if all society property invest to house marcket and less flow into other induestries and tech development, no doubt China will become 2nd Big Japan or 2008 America crises. Now the biggest enemy for China, not U.S / Japan / Vietnam etc is the Greed and Excess HOT-MONEY into house market investment, Mr Xi must put down it and make China house market return self-use function not fire house price. If China house price continue rise, will strongly affect other induestries investments, will affect China economy healthy development and increase risk of economy crisis, will affect China social stability, at last will affect CPC government

    So my best wish is Mr Xi put down today crazy investment for China house market, and for me i also plan to buy another new small apartment (60 m2), but at least one million RMB (200,000 - 300,000 U.S dollar) house price is still the pain for a normal Chinese family.

    Put down Hot-Money investment for China house market, is a good thing for China economy and person development. If personal wealth get twice time increasement , but house price 5x -10x times rise, the society property only into 1% rich pockets. The whole nation will pay for economy cirsis and revolution. Hope CPC not stupid as the 2nd KMT, beat by power & money in Chinese history.

    [​IMG]
     
    Last edited: May 29, 2014
  3. cnleio

    cnleio ELITE MEMBER

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    What about ur nation's house marcket price in the city or surrounding residential areas ? Just share here ... :-) In ur big cities (Many jobs provide and most young ppl like to live & work there),

    1. How many times gap between local house price (U.S dollar/m2) and average family income (earning/month) ?
    2. How many years for young ppl & family to own a house (at least 60m2) or have down-payment of bank loans for new house (Whatever new building house or 2nd-hand house)?

    Come on, let's see what situation of house market in foreign nations.:yahoo:


    A standard residence community around China city where i ever lived.
    [​IMG]



    A new building China residence community, i think it's still construction site now.
    [​IMG]
     
    Last edited: May 29, 2014
  4. Lux de Veritas

    Lux de Veritas BANNED

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    When Kuan Yew in Singapore was fighting his life against communist, he offered citizen public housing costing as low as 3 years median family income 40 years back, for many many years. At that time, most family in Singapore has only 1 income earners.

    Even with this, Singaporeans citizen suffered huge damage. Kuan Yew housing charity is base on forcibly acquiring poor citizen's land at almost zero price. The rich people area are being left unmolested. Also the public housing is on 99 years lease hold.

    Kuan Yew's housing charity is in fact robbery, but he still manage to give us something back.

    In recent years, Kuan Yew and son get increasingly greedy and shameless. He sold the land acquired from us back to us by a hefty markup. Today, our public housing of around 100 sqm is around 4-9 years our median family income under the BTO scheme. And today, almost all family is double income. And not too many people are able to get such cheap price. You neeed to go lottery. Then, you need to wait for 5 years if you manage to strike lottery.

    Our 100 sqm public housing on average is around SGD450,000, or USD360,000.

    Kuan Yew want to force us into private housing market.

    Our private appartment of 100 sqm is around SGD1.5 million or USD1.2 millions. That is around 20x our median household income, and today most household is double income family.
     
    Last edited: May 29, 2014
  5. cnleio

    cnleio ELITE MEMBER

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    I think to buy 100 sqm house need 4-9 years, is Okay for a normal family. If join work after university graduated at 24 age, it's reasonable for a family to own a 100sqm house at 35 age.

    The same house in China, maybe less 10years in un-developed cities of West or Middle China, or over 10 or 30years in developed cities of East China. It's PITY the China house only 70 years lease hold.


    Well it's 10 years for Singapore family to own a new 100sqm house. Thank you for share,Lux de Veritas.
     
    Last edited: May 29, 2014
  6. Lux de Veritas

    Lux de Veritas BANNED

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    That is the reason many PRC migrants here like Kuan Yew and PAP.

    But in the western countries at the time when they are bribing their citizen against communism, the average house price to family income ratio is around 2-3, and at that time many families are single income.

    What is the ratio for annual income vs. cost of house? Details...?

    Capture.PNG

    The World Factbook

    The above is Singapore birthrate from CIA factbook. Kuan Yew squeeze us so dry that Singapore on average 1 woman give birth to 0.8 baby-- the fxxking lowest in the world. A lot of Singaporeans are in debt.

    But I think PRC city could be worse. In fact Kuan Yew and all East Asians leaders are scums and parasite who feed on hardworking citizen by landlordism. Same thing happen in Taiwan, China, Singapore, HK, Korea, Japan and Vietnam.

    毛主席干掉地主,我虽然觉得下手太狠,但地主是东亚文明的cancer.

    Kuan Yew has now addicted on hardworking Singaporeans that he cannot and do not want us to relax. He want us to work till death/ To remedy our falling birthrate, Kuan Yew flooded us with foreigners, like PRC and the worse race in the whole world--Indians.

    Today, half of more Singaporean workers are foreigners and we are too hospitable to allow this to happen. Now Kuan Yew has push the most hospitable people into racism. Singaporeans are getting more and more Xenophobic.

    Then Kuan Yew blame us and label us as racist.
     
  7. cnleio

    cnleio ELITE MEMBER

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    @Lux de Veritas One question: Do ur family need to pay house tax each year in Singapore, like house tax in U.S ? The only fortunate, no house tax in China house marcket just pay for once (including bank house loans). Well u can think it pay for 70years use rights for Chinese private house.


    BTW Mao is the leader of 90% poor farmers in old China, they f@ck 1% rich landlord in 1949. Compared with landlord in the city, the owners who fire house price and have many empty houses r new 1% rich in the city, the rest renting house r new 90% poor.
     
  8. Lux de Veritas

    Lux de Veritas BANNED

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    In Singapore, the system is rigged in favor of rich. The property tax is base on the expected rent value of your property. So if you are a rich man and you have a house with a big garden, your property could be lower than someone with build up area.

    Also paying property tax base on rent value is problematic. If the property tax is base on land value, aka wealth, for example 1% of the land value, then the rich will not bid up the land price. The higher the land price, the higher their property tax.

    In China, you guys will have property tax base on land value, in the future and I think that is a good idea. It will lower the property price. The rich will be trapped. In China everyone hate 土地财政, revenue from land sales. And land value keep rise because the rich is able to accumulate land with no penalties.

    When there is property tax base on land value, the rich will not buy more house and their house will be smaller. Then there will be enough house for everyone.
     
  9. Jlaw

    Jlaw ELITE MEMBER

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    The housing prices in Toronto is 7x an average family's gross income per year for an average size detached home in an average area.
     
  10. Edison Chen

    Edison Chen SENIOR MEMBER

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    About Xi, I strongly believe Xi & Li combo. Xi is slowly rooting out those groups which depend on politics relations to obtain inside news or benefit to make money. They are the biggest obstacle to our reform. Xi is striking the corruption in state owned or big companies that involve too much with government officials, for example Liu Han and Zhou Bin.

    A few indicators have shown government's support to real estate industry. The problem is we are trying to break the bottle neck of economy. We are throwing high polluted industries away or restrict their approval and creation, meanwhile we still cannot find new pillar industry, because real estate industry won't be long. ATM many SMEs in Zhejiang Wenzhou are struggling.
     
  11. tranquilium

    tranquilium SENIOR MEMBER

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    Here is my personal thought on it. Housing price, especially those in the first line cities will continue to increase, but it will increase at a slower rate and in line with the salary increase. Here is why:

    China's urbanization rate is still just 50%. If the urbanization rate of US and Europe is anything to go by, then a eventually 70% urbanization rate will be the stabilization point for urban expansion. So before reaching that point, more people continue to enter cities, especially first line cities since those are the locations where the biggest opportunities lay.

    Basically, the fundamental reason for the housing boom in China is the continued urbanization process. That being said, what Chinese government has focused on is to make sure the housing price stays affordable. The secondary goal is re-direct cash flow from real estate sector into technological renewal in the manufacturing sector. Let's face it, real estate sector doesn't let you move up the value chain, manufacturing does.
     
  12. Nan Yang

    Nan Yang SENIOR MEMBER

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    You failed to mention that in Singapore, you can use your CPF to pay the monthly installment for your apartment. So nothing will come out of your pocket.
     
  13. Lux de Veritas

    Lux de Veritas BANNED

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    The price to family median income numbers has already is our total family income taken account into CPF.

    http://www.singstat.gov.sg/Publicat...s/household_income_and_expenditure/pp-s20.pdf

    That give a better feel.

    Our median income is around 7.8k per month.

    And our CPF is for RETIREMENT ONLY, when it was founded. Unfortunately when Kuan Yew see we have too much savings, we do not anyhow spend, we are good people, Kuan Yew want to rob us until we become bankrupt.

    Kuan Yew start allow us using CPF to buy house, and Kuan Yew allow rich man to crank up housing to incredible level. At one stroke, all our savings are gone. When we are old, we got no pension fund.

    Fxxx Kuan Yew.
     
  14. cnleio

    cnleio ELITE MEMBER

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    Thank your for share, @JIaw. Just ask, how many income for local average family per year (U.S dollar) ?

    Did u know,

    The house price of BeiJing city 80,000¥/m2 (14,000 $/m2) and 100,000¥/m2(17,000 $/m2) had pass over many America big cities ?
    The house price of some China first line cities 20,000 ¥/m2 (3,500 $/m2) and 40,000 ¥/m2 (7,000 $/m2) had pass over many Japan big cities ?

    Compared with today average Chinese family income per year, ¥50,000 in cities of Middle China or ¥70,000 - ¥100,000 in cities of East China, did u really believe China is a developed country and no any risk of house marcket cirsis ?! Just check World Bank datas.

    If there's anything can beat China economy, no doubt is the collapse of house marcket as the same as American and Japanese did. Or China government plan to release 1,000 RMB cash ? Stupid, it's easy to economy inflation.
     
    Last edited: May 30, 2014
  15. cnleio

    cnleio ELITE MEMBER

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    Right now I don't think China government will execute property tax, coz there'r many resistances specially from inside CPC and the rich groups. 官商勾结 it's not just talk a truth in China society. Except a hard man like Mao willing to lead the poor and the middle class to agaist unfair rules for the rich in BeiJing political circle, just watch what Mr Xi will do.

    Last China leader Hu and Wen left a hot potato to Mr Xi, and hope he can solve this big economy issue within 8 years, or it will be a disaster for every Chinese in the future.