It's a problem for people who indebted themselves to buy those homes with a valuation based on scarcity. Also a problem for the real estate Chinese companies, sector which represents a quarter of Chinese economy.

[+] queermunist@lemmy.ml -8 points 1 year ago* (last edited 1 year ago) (1 children)

Sounds to me like China is trying to solve both of those problems by lowering property scarcity - if this stays controlled it will make properties cheaper so people don't need to acquire as much debt and it will shrink the real estate sector. Since this housing is built through centralized control and not a market, it should be totally under control.

Obviously something unexpected could happen that blindsides the Party, but it looks like politics is in command and everything is proceeding as expected.

[–] 30mag@lemmy.world 13 points 1 year ago (1 children)

Obviously something unexpected could happen that blindsides the Party, but it looks like politics is in command and everything is proceeding as expected.

I take it you didn't read the article.

A former Chinese government official said the country's entire population of 1.4 billion wouldn't be enough to fill all of its empty houses, Reuters reported, citing a video from the state news agency China News Service. China's real-estate struggles rose to prominence in 2021, when industry giant Evergrande became the most indebted company in the world and defaulted. At the time, there were at least 65 million vacant properties in the country, which would have been enough to house the entire population of France, Insider previously reported.

To me, this seems wasteful. I'm not very familiar with the Chinese real estate market however.

[–] queermunist@lemmy.ml -1 points 1 year ago (1 children)

There should always be a reserve supply of vacant properties to give people freedom of movement between regions and cities.

[–] 30mag@lemmy.world 6 points 1 year ago (1 children)

This might be overkill:

At the time, there were at least 65 million vacant properties in the country, which would have been enough to house the entire population of France, Insider previously reported.

[+] queermunist@lemmy.ml -7 points 1 year ago (1 children)

That doesn't actually mean there are 65 million surplus properties. A vacant house isn't an unnecessary house. Children move out all the time, families sometimes break up, Chinese citizens currently living overseas or in Europe return home, etc.

I bet there's actually math for this - I wonder if anyone has calculated the optimal amount of vacancies?

[–] 30mag@lemmy.world 4 points 1 year ago (2 children)

That doesn't actually mean there are 65 million surplus properties. A vacant house isn't an unnecessary house.

That is a very good point. I still find it hard to believe that they are making the best use of labor and materials with situations like this:

Ordos, near the border with Mongolia, was meant to hold over 1 million people and become a cultural and economic hub. But by 2016, its population was only around 100,000, and it has been described as "the largest ghost town in the world."

[–] zephyreks@programming.dev 3 points 1 year ago

Sometimes, you misspeculate. Some developers lost a whole fuck ton of money on the project, but that's more than made up for if you can turn a profit on projects near big cities (which demand is still sky high for).

[–] queermunist@lemmy.ml -4 points 1 year ago (1 children)

I still find it hard to believe that they are making the best use of labor and materials

Is anyone? If I have to choose between "housing shortage" and "housing surplus" I know which society I would prefer.

[–] 30mag@lemmy.world 4 points 1 year ago (2 children)

Sure. The point I was trying to make is that society might be better served by allocating resources to building hospitals or schools or something the community needs instead of housing that the community does not necessarily need because there is already a surplus of housing.

[–] zephyreks@programming.dev 1 points 1 year ago (1 children)

China isn't really limited by construction resources. There's a heavier constraint in terms of hospital staff and teachers than there is on construction resources.

[–] 30mag@lemmy.world 2 points 1 year ago

China isn't really limited by construction resources.

Maybe they aren't running out of concrete and steel, but they are taking out loans for these construction projects.

[–] queermunist@lemmy.ml -4 points 1 year ago

They're also building hospitals and schools so...