60 MINUTES Exposes China's Real Estate Bubble
A must watch.
Empty highways, empty buildings, empty cities.
China's economy has become the second largest in the world, but its rapid growth may have created the largest housing bubble in history.
Wang Shi, chairman and founder of real estate developer China Vanke tells Stahl that if the bubble bursts, it could spark China’s version of an Arab Spring, bringing social unrest and political upheaval in its wake.
And right on cue, here's the latest move by Beijing (earlier today) to dampen real estate prices, including a new 20% capital gains tax on property transactions.
Today, Chinese stocks suffered their worst drop in several months.
Broadcast last night on CBS.
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Bonus clip from last night's show:
Zhang Xin: China's Self-Made Baillionaire Real Estate Mogul
How she went from working in a sweatshop to becoming a billionaire real estate mogul.
Mar 19, 2013 at 4:54 AM
Reader Comments (10)
http://blogs.marketwatch.com/thetell/2013/03/04/chinas-top-real-estate-ceo-sees-housing-bubble-hopes-leaders-can-fix-it-report/
http://blogs.marketwatch.com/thetell/2013/03/04/jim-chanos-wants-you-to-watch-this-video-on-chinas-property-bubble/
Jia Kang, the head of the Ministry of Finance's Institute of Fiscal Science, said that as a result, some of the measures wouldn't necessarily be permanent. The measures include plans to enforce a personal income tax of 20% on profits from home sales and an increase in down payment and mortgage rates on loans for second-home buyers.
http://www.marketwatch.com/story/china-adviser-property-curbs-may-hit-demand-2013-03-04
http://www.marketwatch.com/story/japan-stocks-surge-as-asia-shares-sink-2013-03-03
As Balzac said, " "behind every great fortune lies a great crime."
http://www.reuters.com/article/2013/03/08/us-gmbuilding-china-idUSBRE92717S20130308
[snip]
A group of Chinese investors including Zhang Xin, the chief executive of commercial real estate developer Soho China Ltd (0410.HK), are in talks to buy a 40 percent stake in the iconic General Motors building in Manhattan, two sources familiar with the matter said.
The deal would value the GM building at $3.4 billion, the sources said, making the 50-story office building on Fifth Avenue near Central Park the most valuable office building in the United States.
The sellers are a group of Middle Eastern investors that own 40 percent of the building, said one of the sources.
The other 60 percent is owned by landlord Boston Properties Inc (BXP.N), which paid $2.8 billion to acquire the GM building from Macklowe Properties in 2008.
The sovereign wealth funds of Quatar and Kuwait invested in that deal through a Goldman Sachs Group Inc (GS.N) entity, as did a private-equity firm affiliated with the ruling family of Dubai.
Zhang has shown more interest in U.S. properties than other big Chinese investors, who have generally avoided direct purchases of U.S. real estate even as other foreign buyers have been active. She is investing in the GM building with her own personal wealth, not Soho China's funds, one source said.
Zhang's family acquired a 49 percent stake in Park Avenue Plaza in 2011 for nearly $600 million and was also part of a group that acquired Sony Corp's (6758.T) U.S. headquarters in New York, the Wall Street Journal reported.
Zhang also tried to provide $800 million in financing for Vornado Realty Trust (VNO.N) to build an office tower above the Port Authority bus terminal in Midtown Manhattan, but that was project was ultimately scrapped.
http://www.weeklystandard.com/blogs/immelt-communist-china-works_665280.html
I owe you big time.
http://www.reuters.com/article/2013/10/09/us-usa-fracking-rights-specialreport-idUSBRE9980AZ20131009
(Reuters) - Robert and Julie Davidson fell hard for the gleaming new house at the Valencia Golf and Country Club in Naples, Florida. They loved the way the palm-fringed, Spanish-style home backed up to the fifth-hole fairway. And they were taken with the three-bedroom's high ceilings and open plan. Plus the neighborhood - with its power-washed driveways, blooming hibiscus and guarded gatehouse - seemed all "dressed up."
But when the Davidsons paid $255,385 in 2011 for the house on Birdie Drive, they didn't know that they had, in essence, bought only from the ground up, and that their homebuilder, D.R. Horton, had kept everything underneath.
"Wait a second, wait a second," Robert Davidson said after a reporter told him that a search of county records showed that D.R. Horton still owned the oil, natural gas, water and other natural resources beneath his and his neighbors' homes. "Let me sit down a minute here. They have the mineral rights to the land I'm on?"
In golf clubs, gated communities and other housing developments across the United States, tens of thousands of families like the Davidsons have in recent years moved into new homes where their developers or homebuilders, with little or no prior disclosure, kept all the underlying mineral rights for themselves, a Reuters review of county property records in 25 states shows. In dozens of cases, the buyers were in the dark.