Builders offering condos at 50% reduction in inland provinces (Jiangxi)
In Xiamen, builder discount of 40% led to violent protests on the street by current owners. (Bought at $720k, now valued at $430k).
In Shanghai, builder discount by 20%.
Most builders living off credit, with credit drying up, there goes the fire sales. Things will be a lot worse then our prior bubble burst. Chinese real estate valuation is 5 times the size of their GDP. The Japanese bubble burst in the early 90’s had a valuation to GDP ratio of 2:1. The US 2008 bubble burst had a valuation to GDP ratio of 1.7:1. Not only that but building quality universally is atrocious, that’s going to make recovery efforts that much more difficult.
This coming right off the heel of bursting of the P2P lending bubble.
And suddenly our real estate market grinds to a halt. The Chinese led bubble burst has begun.
