[quote=stockstradr]stockstrader, I normally don’t extend this advice to you. BUT, I remember reading you said your wife bought property in china.
I told her a year and a half ago we gotta sell the damn thing. It is in her name (because that’s the only way I could get the 20% down mortgage from the Bank of China.)
No question the China real estate market decline is now going countrywide and just getting started. This is troubling me every day.
The ONLY thing in favor of keeping that China home is the coming dollar collapse working with the 5:1 leverage of the loan.
In other words, at the same time the value of my China house is falling in nominal RMB, the dollar will probably start collapsing against the RMB. (The dollar has already fallen 17% against the RMB since we bought that home.)
That home is now worth in USD about $350K, where over half is equity. We bought it for $120K, using only $40K of our money (portion of which was used for remodeling) It is a big home: 212 sq m^2
So that house is a nice way to leverage up my dollars (in RMB) to take advantage of accelerating decline in dollar relative to the RMB.
HOPEFULLY, that will hedge against the same time decline in real value of the home measured in RMB, as the Chinese real estate market falls.
It also keeps our marriage strong! Better treat my wife right, or else house and wife go bye bye![/quote]
I’ll tell you, at least things were in your wife’s name. We were doing things in relative’s name. I didn’t like it, because if you ever get into a legal mess, yeah what legal system? Sue? Anyway, like I said, things are gonna get harry there. Most of the RE we picked up weren’t open to the public. Relative of a relative of a relative was a bank exec responsible for financing real estate developers in Shanghai and the outside provinces. And of course real estate developers always extended pre-market homes to the lenders. A lot of shady sh!t frankly regarding “for sure returns”.
There’s another thing you’ll need to consider. Ask your wife about the rules of converting RMB back to any other currencies. My understanding is that while generally there isn’t problems converting USD to RMB isn’t as easy (government imposed limits to control the currency, on individuals). Businesses are usually excluded from certain rules, so you can read between the lines. Rules might have changed though.
