{"id":39148,"date":"2018-10-15T06:31:38","date_gmt":"2018-10-15T11:31:38","guid":{"rendered":"http:\/\/olduvai.ca\/?p=39148"},"modified":"2018-10-15T06:31:38","modified_gmt":"2018-10-15T11:31:38","slug":"violence-public-anger-erupts-in-china-as-home-prices-slide","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=39148","title":{"rendered":"Violence, Public Anger Erupts In China As Home Prices Slide"},"content":{"rendered":"
\n

Violence, Public Anger Erupts In China As Home Prices Slide<\/a><\/span><\/h3>\n<\/div>\n
\n
\n
\n
\n

Last March, we discussed <\/a>why few things are as important for China’s wealth effect and economy, as its housing bubble<\/s> market. Specifically, as Deutsche Bank calculated at the time, “in 2016 the rise of property prices boosted household wealth in 37 tier 1 and tier 2 cities by RMB24 trillion, almost twice their total disposable income of RMB12.9 trillion<\/strong>.” The German lender added that this (rather fleeting) wealth effect “may be helping to sustain consumption in China despite slowing income growth” warning that “a decline of property price would obviously have a large negative impact<\/strong>.”<\/p>\n

<\/a><\/p>\n

Naturally, as long as the housing bubble keeps inflating and prices keep rising, there is nothing to worry about as the population will keep spending money buoyed by illusory wealth appreciation. It is when housing starts to drop that Beijing begins to panic.<\/p>\n

Fast forward to today, when Beijing may be starting to sweat because whereas Chinese property developers usually count on September and October to be their \u201cgold and silver\u201d months for sales, this year has turned out to be different. As the SCMP reports, not only were sales figures grim for September, but the seven-day national holiday last week also brought at least two “fangnao<\/strong><\/em>” incidents \u2013 when angry, and often violent, homeowners protest against price cuts offered by developers to new buyers.<\/strong><\/p>\n

These protests are often directed at sales offices, with varying levels of intensity \u2013 from throwing rocks to holding banners and putting up funeral wreaths. The risk, of course, is that as what has gone up (wealth effect) will come down, and as home ownership has remained the most important channel of investment for urban households in China in the past decade, price cuts have become increasingly unacceptable and a cause for social unrest<\/strong>.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Violence, Public Anger Erupts In China As Home Prices Slide Last March, we discussed why few things are as important for China’s wealth effect and economy, as its housing bubble market. Specifically, as Deutsche Bank calculated at the time, “in 2016 the rise of property prices boosted household wealth in 37 tier 1 and tier […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,6],"tags":[130,1839,406,2340,656,15730],"class_list":["post-39148","post","type-post","status-publish","format-standard","hentry","category-economics","category-liberty","tag-china","tag-deutsche-bank","tag-housing-bubble","tag-housing-market","tag-protest","tag-south-china-morning-post"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/39148","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=39148"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/39148\/revisions"}],"predecessor-version":[{"id":39149,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/39148\/revisions\/39149"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=39148"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=39148"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=39148"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}