Not true, people want to live there, most just can't afford it. In fact in some of these towns most of the units have been sold -- just not sold to people who live there.
"Can someone explain why this does not indicate the Chinese economy is headed inexorably towards a massive crash"
Probably in the same way that no one going to see Adventures of Pluto Nash didn't cause a massive crash in the US economy or even in the film industry here. I'll elaborate...
What percent of the Chinese economy is real estate? 6%?
What % of Chinese real estate do these ghost towns represent? 1%? 5%? 10%?
Are there 20 success stories (boom towns) for every ghost town? 5? 10? 100? None?
Ghost towns maybe a real and dangerous symptom of a coming Chinese crash. Or not. It's really hard to jump from "giant examples of waste" to "the economy is going to crash".
There are certainly other indicators that housing is a huge bubble in parts of China. There's also the inexorable and unbelievable growth that China has experienced over the last few decades. Growth like that has a tendency to make lots of things look like bubbles that aren't.
Lets not forget China's economy is overwhelmingly export driven; so the fact that they might decide to build towns and not use them- whilst seeming really odd- doesn't seem to me to be predictive of any kind of an economic crash.
The difficulties that western economies are having would seem a much greater threat to China's economy than this.
>There's also the inexorable and unbelievable growth that China has experienced over the last few decades. Growth like that has a tendency to make lots of things look like bubbles that aren't.
Thanks for the explanation. Same goes to the other replies.
Not true, people want to live there, most just can't afford it. In fact in some of these towns most of the units have been sold -- just not sold to people who live there.
"Can someone explain why this does not indicate the Chinese economy is headed inexorably towards a massive crash"
Probably in the same way that no one going to see Adventures of Pluto Nash didn't cause a massive crash in the US economy or even in the film industry here. I'll elaborate...
What percent of the Chinese economy is real estate? 6%?
What % of Chinese real estate do these ghost towns represent? 1%? 5%? 10%?
Are there 20 success stories (boom towns) for every ghost town? 5? 10? 100? None?
Ghost towns maybe a real and dangerous symptom of a coming Chinese crash. Or not. It's really hard to jump from "giant examples of waste" to "the economy is going to crash".
There are certainly other indicators that housing is a huge bubble in parts of China. There's also the inexorable and unbelievable growth that China has experienced over the last few decades. Growth like that has a tendency to make lots of things look like bubbles that aren't.