The Chinese housing bubble is deflating faster than a Chinese made balloon at a kids birthday party. Home prices are plunging. It seems buying 10 unoccupied condos before they were built really wasn’t a path to easy riches. The Chinese should have watched the later episodes of Flip That House, before the show got canceled.
The best chart is #8. Since Americans don’t understand the metric system, I’ll convert it to something you’ll understand. The Chinese currently have 32 million square feet of VACANT residential real estate for sale. The average home size in the US is 2,100 sq feet. The average home size in China is 650 sq feet. They are a tiny people with much lower obesity levels, so they can fit in smaller spaces. They now have approximately 49,000 unoccupied homes for sale in their cities, up by 70% in the last 18 months.
The panic has begun. All the real estate “investors” are trying to dump their unoccupied condos at the same time. Where have we seen this before? I’m sure it will end well.
Admin
Yesterday when I responded to your question regarding my shelving units, I said all was A-OK. But, at the time I only built the two 4-shelf units.
This morning I tried to put together the 2-shelf unit. There are supposed to be 14 little one-inch dowels. They gave me 6. So, Ms Freud and I will be heading BACK to Ikea tomorrow around 11AM. Fuckers!!! You win. I hope they have some dowels in stock. Otherwise, I will open a box and take what I need. Fuck ’em.
Pray for us. We’re gonna have lunch there. Why? The view … as you know it’s right across from the Newark Airport runway …. and it’s fun watching those planes land, especially the 747s. We’ll stay away from the horse-meat meatballs. Maybe get some cheese/veggie platter … what could go wrong?
“The average home size in China is 650 sq feet. They are a tiny people with much lower obesity levels, so they can fit in smaller spaces.” ——– Admin
Fuckin hilarious.
Yet once again … reminds me of a Seinfeld episode;
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Those charts look like roller coaster drawings to me. ha!
At least they still have our production and the world’s rare earth minerals.
Some rich guys will throw themselves off buildings. Some stupid rich white guys will take it up the ass but be able to use it as a write off on their ill-gotten Western gains. A few execs from some Chinese firms will be paraded out in public and shot.
But will they keep shipping us chicken nuggets, insulin, syringes, iPhones, batteries and lightbulbs.
That’s the real question that affects my life.
We just got an Ikea. My wife is making me go with her.
If I don’t make it back…..delete my browser history.
TE says: “But will they keep shipping us chicken nuggets, insulin, syringes, iPhones, batteries and lightbulbs.”
That’s why I check all grocery labels B4 buying……. if it says “imported from China” – it stays on the shelf……
Once the Chinese government allows the Renminbi to appreciate there will be plenty of home buyers in china.
From EverBank:
“We regard the renminbi’s depreciation year to date as finite and implying a likely recovery, rather than further weakness. If one believes – as, in our view, the evidence suggests – that China hasn’t changed its stance on the currency, then the renminbi’s performance on a rolling 12-month daily basis should be flat to positive. If that’s the case, this year’s depreciation has reached a point relative to last year’s performance, illustrated by the blue line in the chart, at which the daily fix may strengthen, reversing the recent trend. This would enable the renminbi to resume its steady appreciation on a rolling 12-month daily basis and keep the positive currency policy intact.
In other words, the PBOC’s desire to maintain an appreciating currency is likely to result in an end-of-year rally in the renminbi.”
Also:
“Last month’s data showed foreign investors pulled $18.7 billion out of the US financial system, economists had expected to see a reversal of this in July.
Well the number which was released yesterday afternoon showed another $18.6 billion was removed from the US by foreign investors last month. This was a big surprise to economists who had predicted an increase of $25 billion in TIC flows for July.
The data showed China’s holdings of US Treasuries fell to $1.265 trillion in July as foreigners sold US Treasuries for a second consecutive month. Chuck has been warning readers of the Pfennig about what would happen if/when foreign investors finally start to sell their US debt. Foreign buying is what has helped keep our rates so low for so long, and these negative TIC flows at the same time QE is ending is something which I’m sure Chuck is watching and worrying about. If foreign demand continues to wane rates could move higher much more quickly than anyone has predicted including our own FOMC.”
Couldn’t happen to a better bunch. Guess the money they laundered in US real estate looks like a good move, huh?
@Fiatman60
Looking for “imported from China” and not paying attention to “Distributed by” means you are still eating Chinese food.
NONE of the Walmart brand foods (Great Value? It’s been so long I can’t remember) that I called on were produced in the USA. NONE of the boxes/cans were marked as such. All they said was, “Manufactured For Walmart” or “Distributed by Walmart.”
China killed my dog and led to my opening my eyes about the poison we are pumping into our bodies.
The ONLY thing I’ll buy from China happily is Green Tea. It is grown there after all. And I really don’t even trust that.
The ONLY thing I’ll buy from China happily is Green Tea. It is grown there after all. And I really don’t even trust that.
Nope … I wouldn;t trust tea either.
“And some green tea leaves, particularly those from China, are contaminated with lead, though the metal does not appear to leach out during the brewing process.”
—-
“Does not appear ..”?? Yeah, whatever ….
This is hilarious.
I finally got around to putting up that 54″ picture I bought from Ikea. They included the picture wire for hanging. Unfortunately, the wire is only 48″. hahaha! I’m not kidding. (Fortunately I have plenty of picture wire.)
Out of millions upon millions of homes, 49,000 empty ones is an enviably low rate. This writer knows not whereof he speaks.
70% increase in 18 months you moron. Maf is hard for morons.
Prices plummeting you moron. Can you read a chart or did you go to Phila public school?