The Great Fall Of China's Housing Market: Who Will Pay The Price? | Insight | China Mortgage Boycott

In July, thousands of Chinese homebuyers threatened to boycott mortgage payments. Since the Evergrande Crisis, other cash-strapped developers have halted construction, leaving millions in limbo.
Over speculation left Chinese property market in jeopardy. Meanwhile, desperate homebuyers have moved into their unfinished apartments, making do without electricity and water. With echoes of the 2008 US subprime mortgage financial crisis, people around the world are closely watching how this crisis in China will unfold.
What is behind China's mortgage crisis?
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[@MarkLeonard-xn8zs]

You don't know what the Chinese (stock)market will do, owning Chinese stock does not mean you own a part of the company, please be aware of that. BYD is making mini cars, hybrids and ice cars, not so much BEVs. Numbers are not looking that great too. Their batteries are great tho and will be used by Tesla as well.

[@SmithJones-yx1ut]

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[@SmithJones-yx1ut]

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[@EleanorShaw-od9dj]

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[@Duke6598]

wdym numbers not looking great? I think their stock is doing pretty good for a car manufacturer

[@Tarot.of.Cups69]

China electric cars are catching fire. I would never buy a electric car from China. Or Tesla.

[@airot1987]

this is why they are "laying flat". What's the point of anything anymore?

[@therearenoshortcuts9868]

2022: "laying flat" 2025: "playing dead"

[@dondrumpf5422]

@@therearenoshortcuts9868 Yes, in United Satans of AmeriKKKa!! No wonder so many homeless and drug-addicts there, no?? Too bad! Hahaha.. hahaha.. hahaha..

[@Flipgenerals]

And the new and more active disruption of Bai Lan: "Let it rot"

[@dondrumpf5422]

@@Flipgenerals exactly! In United Satans of AmeriKKKa, right??

[@j.c.4192]

@@therearenoshortcuts9868 there will always be some that are hungry to fill the void

[@robl9141]

Gov’t allowed pre-sale because Chinese land are all owned by the gov’t. Developers pay for decades of rent in advance. So the faster developers expand, the more proceeds gov’t receives, the more money goes into corrupt officials/businessmen pockets.

[@leezhieng]

most other countries also allow pre-sale. not just china.

[@jamesclapp6832]

So if you have a mortgage in China you really are just paying a third party for the privilege to rent from the government?

[@lennyhardi3760]

The problem start because the cobid lock down too long. There is no other country like china that lockdown almost 3 years. Completely lockdown. How do you expect the economic will not crash if you lockdown like that ? The private industry foelr sure will collapse! I don't know what is the leader of china think that time. Only they know the truth (and God)...

[@deebil8099]

@@leezhieng Nobody starts paying their mortgage before moving in. You put a down payment to hold the apartment and when the apartment is finished you do the closing and the bank gives them the rest of the money. Even if for some reason they can't finish the apartment, you get your down payment back. This can only happen in China because the corrupt CCP officials are in on it. They are stealing the money from ordinary poor people and their is nothing you can do about it. If you protest, you will be thrown in a slave labor camp with the Uyghurs.

[@donaldmaxie9742]

Unfinished buildings exposed to the weather for extended periods of time tend to deteriorate in unexpected places and ways. How many of these structures will need some "remodeling" before they can be finished if they ever are? Really sad for the buyers.

[@fernandoxavier1887]

,

[@bobandlucas]

Sooo tragic for Mr. Li Cancelled wedding and abortion for baby because of apartment not completed. Definitely the vow 'for richer and poorer ' is not in the card. If I'm the parent in law I'll hasten wedding and offer couple to move in with us They're giving me the most precious gift ever -a grandchild. Wish Mr Li all the best.

[@reviewfreak66]

He dodged a bullet

[@satriaamiluhur622]

Thank god my parents in law just told me to live with them, because they knew that if i and my wife spend our income on housing, there would be very little left to raise our daughter

[@MotozVietnam]

❤❤❤ facts

[@firstnamelastname-ys3mz]

Gay

[@Layput]

@@firstnamelastname-ys3mz It's not gay. Asian culture is different from western in that living with parents are considered shameful. Not in Asian culture.

[@ishansoni2249]

@@Layput he is living with his in laws and this is shameful in Asian culture

[@maximwilson1482]

As things get tougher hopefully this phenomenon becomes less stigmatized. Life is tough enough without gossiping “aunties” and other problematic characters. Less and less room for that 💩.

[@MakerInMotion]

Having had bad experiences with contractors, I can't imagine paying for a home that hasn't been built yet.

[@jackreacher8858]

LOL

[@cthgbs6267]

I think housing developers are the greediest and sometimes the most unethical among all types of businesses.

[@coldheaven2584]

Of course, they take all the real estates to spike up prices, to then sell them later for massive profit due to them owning most of the estate and have the ability to set insane prices. It's ridiculously stupid and form a bubble that has finally popped right in their face, but unfortunately the one who suffer most are not them but the people who still need a place to live. This stuff should have been heavily regulated but it's not in pretty much everywhere in the world

[@dondrumpf5422]

Agree

[@SF-dy6hn]

Yes they use the threat of homelessness to force renters to pay any price they want, they collude together to corner markets and fix prices and they pressure lobbyists to create laws that benefit them while hurting everyone else. Real estate is a real dirty game.

[@HKim0072]

It’s all of China. No ethics and everyone will cheat each other for any amount of money.

[@stormryder4305]

They are pigs and CCP's legalize thieves. What else can you expect?

[@hummit]

This is just the tip of the iceberg. If the economy dips further, and disposable income plummets then there will be even more chaos. Problem is I don’t think it’s a ‘if’ but a ‘when’.

[@alexgibb8406]

Its an if. When china gov intervene , crisis will be over

[@dondrumpf5422]

@@MathGPT exactly!!

[@dondrumpf5422]

Hahaha.. Don't worry about it. They will find the best solutions for this problem. Finishing few millions houses is not a very big deal!! Life goes on!!

[@dondrumpf5422]

@@cathhl2440 People are/were warned. Homes are not for speculations!! In any case, they'll manage!! Don't worry about it!!

[@Ex.zed.]

@@dondrumpf5422 Wishful thinking with no knowledge whatsoever of economics.

[@salemdesigns65]

Ohhh...so THAT'S what's going on. So glad this story has been told. Great reporting...

[@dondrumpf5422]

It's in fact just supply and demand problems. And, some reckless companies and investors!! As simple as that!!

[@amberhamster9610]

Florida has lots of pre- construction condos. 10% cash due at signing and held in escrow, 10% due when construction starts, 10% due when the structure is above ground, 10% due when the top floor is reached, and 60% due when certificate of occupancy issued. The developer has 2 years to complete the building once construction starts, or the buyers can demand their escrow back, and the lawsuits proceed. Delays and lawsuits will be in the newspapers.

[@hikashia.halfiah3582]

In China, even if your building got demolished forcefully, your escrow gone poof.

[@maemorri]

The big difference being that the funds are in escrow, and the developer doesn't get them until they hit the milestones. Letting the developer reinvest the purchase prices for general purpose is insane. The government, the banks, and the developers are all operating together.

[@jagpilotohio]

Yeah. In the US you’d never see a mortgage being issued and paid before completion.

[@leexingha]

@@hikashia.halfiah3582 false & misleading. if our gov ordered a demolition against ur will, its becoz u made a violation & didnt head the warning prior

[@janicewolk6492]

The same phenomenon happens in the US as well, but the developer bears the cost of construction. Letting the developer receive consumer funds before the product is finished, is asking for disaster.

[@somponesakdy826]

I don’t remember in US the buyer have to make payments before moving in. Yes the buyers might have to put a few dollars for earnest money, but not making the payments. Chinese own greed(farming on the backs of the others behavior) destroyed themselves. Now Chinese run around the world spreading their greedy behavior to another side of the world. China Realestate is jacking prices up in USA, files bankruptcy in USA. I don’t know why US Government is letting this happen to us? don’t we learn from our own mistakes 2008.

[@MsEverAfterings]

I wish Li the best. While he has accepted his reality with grace, I hope he will see the light at the end of the tunnel for him.

[@jeremylewis5154]

Mortgage payments on unfinished property is a red flag in itself.

[@johdo9953]

The problem is lack of governance. How would you allow funds to leave a project and expand to other project like buying more lands. So in the end there is no money left for the project when initially it had got all the funds.

[@anthonyyoung6489]

It’s called a Ponzi scheme.

[@naguoning]

44:00 the reason why the central government is not intervening more is quite simple. They would rather deflect the blame for an ever growing crisis than absorb responsibility themselves. Much better for them if the public thinks it is the fault of corrupt local officials.

[@alexgibb8406]

Huh? They can always blame the local officals and then bail out. The question is why are they not bailing out when this crisis is 30 percents of gdp?????

[@pod11th31]

@@alexgibb8406 Bailing out" is just moving funds from one stack to another it's not adding anything to size of avaible funds.

[@sonickchri]

@@alexgibb8406 I think they already proposed offering something like $7,000 USD to those affected in the form of relief (which will nowhere nearly cover the cost for everyone, of course). However, it's as pod11 th says, it will not truly be helping the populace as a whole as it just results in using tax dollars or funds from elsewhere.

[@joetan84]

Because they don't want to set a precedent...

[@MrKongatthegates]

the problem is that the government is just the people, and the problem might be so large that they dont have the resources to stop it

[@kenyonbissett3512]

Many Americans did the live in your business offices during the 2008 crash. Without employees they had space and set up a front office and lived in the back office. They had lost their homes too the mortgage crisis. They showered at the gym, set up a small appliance kitchen and used the office bathroom. When times got better they moved to a home.

[@edvoon]

It's crazy how they had to start paying mortgage even before a single brick was laid. That's a system that's just too easy to exploit and gives all the advantages to the developers with no safeguards for the purchasers. The usual norm would be to pay a deposit to secure your place and the remainder of the balance is only required upon completion and delivery, with a sunset clause that releases the purchaser of any liabilities should the project not be delivered on time and the deposit refunded (assuming the developer hadn't gone broke). It's devastating enough losing your deposit to a failed developer but nothing compared to being saddled with the full debt for a property that was never delivered. The CCP should worry about its internal finances instead of trying to build the largest navy in the world or wasting trillions in bad loans to 3rd world countries to make them debt slaves to do China's bidding. It's a shame that autocrats will always have delusions of grandeur while their citizens suffer.

[@Straightfromtheheart8691]

Can’t agree more! What a flawed system from the CCP, a totally irresponsible government. It is just Common Sense, even for a lay man, that deposits from the property purchasers should be put in a trust account (used only for the specific project) and developers are being paid progressively by the bank according to the stages of construction. Funds from project A must never be allowed to use in project B until the whole project is completed. It is the government’s responsibility to regulate the developers and obviously they failed miserably!

[@joechan3388]

@Edwin Voon, Vietnamese copies everything American and outdo the American, Vietnamese definitely will outdo those American scrupulous practices. Unfortunately the real estate developers in Vietnam are all connected to the Vietnamese ruling elites, no bad news is allowed to be published. If CNA Insider ever tries to do the same stun on Vietnamese, its staff will face being locked up in the "Hanoi Hilton Hotel" for good. CNA Insider misled the readers about mortgage payments in China with misinformation. Unlike other countries, China treats housing as essential to the welfare of the nation, there are tight laws to protect home buyers. Default developers will be severely punished. China is surrounded by bandits, thieves, and murderers like the American, Japanese, Taiwanese, and Vietnamese. Without big sticks, those bandits, thieves and murders will have their hey days again by plundering, stealing, and murdering in China like in the old colonial days.

[@hkpfalldie]

This is how the CCP gets its navy funded

[@RichardAddison]

The developers should certainly never have been able to get away with this, but then if everyone is locked down at home because of Covid what does anyone expect? Bankruptcy for all?

[@josephzirk6523]

We have no choice and everyday people have no say in government policies. We have to accept whatever is given to us, from how the country is ruled to wages, news to histories and we have to give a happy face to everything.

[@craigcrawford6749]

This is the practice in Taiwan too. People take out mortgages based on a model of the proposed building. It's so stupid.

[@edvoon]

Buying off the plan is common practice in Australia too, but the huge difference is that the full payment isn't required until completion and delivery, which puts the risk on the developer and not entirely on the purchaser. It also makes the developers more responsible as it's their own money and liability on the line to get projects completed.

[@paulyoutobe9742]

its a common practice everywhere but the difference government can see immediately if there is an issue

[@browncony3897]

Buyer pays 40% down payment, bank pays 60%. No wonder developers run away with the $. A recipe for collapse. 😅

[@LGandM]

Fascinating documentary, thank you. I was aware of much of this but to see the numbers/massive scale of the problem, and those poor people personally affected by the construction of their homes coming to a screeching halt, is really something.

[@ogapadoga2]

I find it quite amazing that CNA crew were allowed to film all these inside China.

[@ggc7318]

They would be disappeared soon like those chinese human rights lawyers.

[@ellenation2294]

It’s cus their documentaries are quite balanced…. They actually interview the people and show their point of view. Also Singapore and Chinese relations are actually quite good but any documentaries u see from USA UK Australia Europe are always about the bad things in China…. U would be an idiot to think they are at least balanced. Even I think Al Jazeera is better ….

[@tiefblau2780]

LoL Jhinest LOLOLOL Perish U Pollution!! They turned a blind eye and let the gov do whatever it wants, saying, shouting, Numba 1, while never looking at what its actually happening. And now they are going to cry and you are going to help? LoL For them not helping themselves and letting PRIDE BLIND THEM?

[@tdnow4416]

I only be amazed if this video show in China!

[@skylinec83]

This is China - not North Korea. Despite the large number of narratives saying how dystopian China is, it’s not where near North Korea.

[@maestrovso]

This is a piece of excellent journalism, with real footages taken. It is one of the most detail, indepth, and objective reporting unlike a lot of others with an axe to grind. Thanks CNA for journalistic integrity and quality.

[@sherlyng7504]

Similarly in Malaysia some projects went bust and abandoned. But the purchasers still need to pay monthly interest rates to the banks. Problem over here is purchasers need to obtain loan for houses that are in preliminary phases of construction. The purchasers only get to view a completed house through brochures and display house in developer’s sales gallery. You pick, book and obtain a mortgage then the rest is at the mercy of developers. Same sobbing story here if projects didn’t turn out.

[@wsmithe2209]

This kind of housing problem can happen anywhere not just China. The media tend to amplify the issue 10 times bigger if it happens in China.

[@hikashia.halfiah3582]

@@wsmithe2209 "anywhere" ? AFAIK from reading, in the west I heard, the problem is regulation that make it really hard to build housing, so there's problem of homelessness rather than ghost city. For Indonesia, the only stalled real estate project I know is Meikarta (which smell like Chinese-style real estate project). We don't have yet problem of ghost town. I feel there's going to be ghost village, but that's more because rural villages are getting abandoned, and the oldies living there dying one by one. Maybe you are mistaking it for demographic problem which is indeed the case in "anywhere" of the world except maybe Africa.

[@alexisvladimir8148]

Which is why it is very important to know the financial conditions of the developers when buying an estate.

[@anandsuralkar2947]

The issue is 10 times bigger in china lol. Its almost jalf their GDP this scale is nowhere in the world

[@Trust_but_Verify]

@@alexisvladimir8148 Who would have known the great Ever Grande was in bad financial shape though? It's better to buy already completed units in that case.

[@gaslitworldf.melissab2897]

Wonder if some have committed suicide due to debt they cannot withstand. China would naturally under-report it, if at all. Sounds like a PONZE scheme in which they bought too much additional land, instead of completing the projects for waiting customers.

[@LittlePanda888]

I wont call it a ponzi scheme. Just a huge bubble fueled by greed and unrealistic ambition.

[@1americanatlarge]

I wander if they find people responsible and started taking their ability to breath this would be straightened out FAST

[@NeptuneKnives]

China is so disgusting

[@dondrumpf5422]

Don't worry too much. It will be solved!! People have to also take some responsibilities!! They are/were warned that homes are not for speculations!! Just look at the cryptos!! Losing 80% of its value in few months time!!

[@bunnyfreakz]

You mean like America also underreported crisis 2007?

[@rhomotor]

As a Chinese American, I bought my first property at the age of 30. Real estate was always thought of as a good investment and something that you can proudly call your own and something you can leave for your kids. I don't fault all those people for wanting to buy a home and jumping into a market that they felt was sound. I would've probably been one of those unfortunate people also.

[@pinklady7184]

When government makes mistakes, people always pay for them.

[@luckyjac7421]

@@pinklady7184 china govt cant be mistake

[@llg4116]

I am another example for investing in the real estate market in China since 2000 and starting to sell properties in 2015 when policy and market have changed. I am able to retire in my 40’s. There are unfortunate cases happened but it’s still a small percentage amount compared to the huge market. Investment always takes risk and needs to do a lot homework. I feel sorry for those people who bought off-plan property. It has uncertainty risk as futures trading. Recently Chinese government launched aiding project to help completing those properties. Hope those people will get what they have paid for.

[@Peizxcv]

It's really luck of the draw. I am Chinese American in New York. If I haven't bought my apartment 12 years ago and keep the money in stocks, I would be semi-retired now. My apartment went up 20%, the stocks I held went to 2000%

[@gf5617]

@LUCKYJAC... where is China vaccine? Sorry to offend YOU!

[@WatchCrew578]

I see how it works in China you pay for the mortgage without even living it . That system never works in the rest of the world. If the developer would finish the house before mortgage is purchased you would never have this problem in China.

[@Gatecrasher1]

Very well-done reporting and insight into the current plight of China's real estate problems

[@youmemeyou]

Øk

[@crosbyong]

Another insightful report. Kudos to writer / narrator, Wei Du. I used to struggle to follow her financial reporting during her time in SG. But she’s written/produced a few pretty good documentary reports since. Thank you!

[@phongy45]

any truth?

[@janicewolk6492]

@@phongy45 Absolutely true.

[@bakchormeeman7864]

It’s scary how much debt a person is willing to take on just because they think the market is doing well.. financial education is so important

[@dondrumpf5422]

Yes, it's called market expectations!! Look at cryptos!! And the Wallstreet!! Very good excellent financial education, right?? Hahaha.. hahaha.. hahaha..

[@yivunqp963]

Financial education is not the key here. Unless you mean "Don't be a sucker. Even if there is free money, you won't be the one getting it", count as financial literacy. In fact, those who speculate the most are those most finance savy.

[@dondrumpf5422]

@@yivunqp963 true!!

[@dondrumpf5422]

@@yivunqp963 they are/were all warned that homes are for living, not for speculations. But still... FOMO phenomenon!!

[@floxy20]

Financial education in the Western sense is irrelevant considering the over reliance on real estate in China and the corresponding irrelevance of the stock market.

[@blakexi3731]

A crash had to happen sometime, especially with the demographic crisis. Even though you could see this coming with all the ghost cities preceding COVID, it still breaks my hearts for those risking the CCPs wrath by not paying or having too much saved and being forced to buy one of these properties.

[@dondrumpf5422]

Yes, you'll face problem if you don't pay your debts anywhere in the world!! And being forced to buy property?? Hahaha.. hahaha.. It might happen, but you can always refuse, no?? Hahaha.. hahaha.. hahaha...

[@SaintSaint]

@@dondrumpf5422 Blake probably means being forced to pay mortgage on a building which is Fail To Deliver. Within legal terms "Time is of the essence" for these mortgage contracts. Simply put, if our vendor defaults on the contract, we shouldn't have to pay the contract. I agree. I guess in China, they have less defenses against FTDs. I tried to buy $8K of solar panels that was FTD at boat(customs was falsely blamed). I had planned a multi-million dollar purchase, but I wanted to see who I was working with first. I'm glad I only lost $8K. but it's unfortunate nevertheless. Some forget that "credit" is just another word for "trust."

[@irone7050]

who told you not paying mortgage will incur CPC's wrath? who told you they are being forced to buy one of those properties? pretty unintelligent remark by typical china demonizer.

[@chrisblue46]

@@dondrumpf5422 you really have no idea of WHAT /HOW Chinese can invest in.

[@leezhieng]

A lot of the ghost cities reported many years ago are now occupied, maybe you need to keep up with the news. By the way you are way exaggerating the demographic crisis. China will still be the second most populated country in the next 20-30 years with the on-going demographic crisis.

[@philiptky5310]

It happened in Singapore in the last financial crisis when the property market crashes. Since then Singapore have try to curb a potential crash again with cooling measures. It does hurt the younger generations with the chance of securing multiple properties while compared with the seniors born in the 1960s and 50s.

[@bobbyhill1156]

Wait for Malaysia.. Just look at what's happening right now. Insane, and people is so asleep that doesn't even seem to understand it.

[@HKim0072]

Naw, not the same. Singapore never had a massive oversupply problem.

[@chrisblue46]

It happened in Japan as well, many Japanese lost everything.

[@vivekshivdasani9521]

Twenty five percent of business bankruptcies in Australia are real estate developers. There too a lot of Chinese from mainland China got stuck in failed projects. They got lured into these investments by relatives living in Australia and by telemarketers who spoke in fluent Chinese, be it Mandarin or any of the other dialects that abound in the mainland.

[@parkerbohnn]

The highlight of everyone's life is watching the Chinese lose all their money when all *their* ponzi's implode especially their housing ponzi.

[@MeiinUK]

It's because those Chinese went abroad and assume that they can do the same. But some idiots have not done the basic calculations and the liveability ratios. Those Pratt's. Some people dare to post online and call themselves bankers. Actually, they are not real bankers, but are mere credit loans client relationship manager or construction finance administrators. This is why.... there was an ft article about HK has a different market than Singapore. These people don't get it.

[@mathieug6136]

Good job on getting Micheal Pettis to comment on this issue!

[@craigkdillon]

Since most Chinese have their wealth in their homes the real estate crash is causing the impoverishment for many of them. I would like to see a video or report analyzing what percentage of Chinese are being impoverished and its impact on the Chinese economy.

[@leetcodeking4859]

This is terrible. If someone has to borrow money for a downpayment, then the system is broken.

[@johnsoncao3114]

Somehow this crisis is not all that bad. Everyone is greedy and to blame others. Actually in Shenzhen city, one of the 4 tier one cities in China. Most ppl (around 80%)rent the house. When the overall population and shrinkage of birth rate, the housing market is doomed to be fallen down.

[@leetcodeking4859]

@@johnsoncao3114 Exactly. I agree.

[@StewartChaimson]

Thank you for producing such a great documentary! China is living in "interesting times", and I agree that how this plays out will affect the rest of the world too.

[@wingsyc]

My advice to clients is buy after the property is built. While you may get a cheaper unit direct from developers, the interests will cost you. Then there's the risks of location, the final product outcome not to mention the risks of non completion. In China being first time buyers, many are not aware of the pitfalls.

[@Graine01]

problem is completed buildings are so out of peoples ability to buy it is not funny. Apts go up 2-5x in price once they have been completed, they already have very low mortgage completion chance, ie with average income it will take 45 years to pay off the average mortgage while in us it is about 23 years.

[@johnsonbrandon4155]

No doubt Chinese Gov is the big boss behind real estate,they get huge profit from the Land.

[@cheeho9698]

These things happen occasionally in a market economy. It happened in US too and is called the "Subprime crisis" but that is not the end of USA, so it will not be the end of China too. It is a periodic adjustment of supply and demand. The people affected are mainly speculators. It is a good lesson to speculators and the government should not bail them out.

[@Premier-Media-Group]

The U.S. has a typical housing cost factor of 4-5x annual income. In China, 35-50x annual income is more typical. These impacts have the potential to be much greater than the subprime bubble in 2008 in the United States.

[@B_y1n]

Did you miss the part the American professor said will be a long drawn out pain for China? It was a quick hit for the US and saw an economic boom afterwards. Until Covid. Don't forget, China's policy with Covid is to shut down the cities.

[@leezhieng]

@@Premier-Media-Group Not sure what you're talking about. A 3 room apartment in Shenzhen is around 2 mil RMB and people working in shenzhen typically get around 200k-250k RMB annual salary so it's around 10x which is not too bad.

[@UU-gc2cr]

It is not the same dude. Rewatch the video

[@BadMrFrosty999]

Greed and corruption equals disaster

[@carmelagarin8645]

That's why you shouldn't buy housing that is not yet built. There is no guarantee they would finish it

[@moonmissy]

It’s a case of group norm, if everyone is doing it, people think it’s safe and normal.

[@tmc702]

We did it and our five apartments were perfectly fine. These people just happened to be in the bad time at the wrong place.

[@SiameseCheese]

I’m certain there was a sense of FOMO amongst the public. All my friends are buying, I should buy otherwise I’ll miss out.

[@spottydv3750]

Because it's cheaper to buy upfront. When it"s already finished, they sell it twice the initial price

[@SiameseCheese]

@@spottydv3750 As long as the market price increases. If it does not, either you hold onto a depreciating asset or sell at a loss. I have a feeling many people can buy condos in China at a discount right now.

[@turquesa_8056]

So basically the developers stole a bunch of money from numerous people/companies and got away with it. Wow......

[@presspound7358]

Excellent reporting. High quality research, storyboard, writing, editing. I’d forgotten that journalism could perform this well. Kudos. 👍🥇🇨🇦

[@littlebitmckee8234]

Just a few minutes into this and my heart is breaking for him. How can corporations or governments be so greedy to steal dreams from people???? Karma will bite them.

[@ariyumam1557]

No such thing as karma..

[@MrKongatthegates]

little more complicated. The company planned to make homes and make profit but other forces caused things to suddenly stop. its not some kind of scam, more like a market failure

[@dondrumpf5422]

How about Wallstreet?? And, cryptos anyone?? Hahaha.. hahahaha.. hahaha...

[@Ex.zed.]

@@dondrumpf5422 How does Wallstreet justify China's biggest, what used to be a government-backed, Ponzi scheme?! Try harder with the deflections, lil PPinkie.

[@jang3178]

@@dondrumpf5422 big diff is that the US govt is not running a corrupt system of encouraging speculative betting. The Chinese municipalities are literally fuelling the issue, they stood to gain the most with the racket, and lose the most when exposed. Why feel the need to defend what is so clearly greed and corruption at the highest levels of government? Sure you see this everywhere in the world to some extent, but never to the same degree in good ol China 😭🤣 Feel so sad for the brainwashed like you. 🥺🥺🤣😭

[@jennycheng3245]

This is sooo sad for most chinese home buyers . Wish them all the bests !!

[@MikesCatholicPrayers]

The way they need to protect their sources...it astounds me how their government is more concerned with saving face than addressing their suffering.

[@freliaz]

Are we any different in the west? Compare with the US - banks taking over everything, especially the single family housing market, crime going rampant, the homeless situation beyond any form of control, the border crisis where everything is just misery for americans and immigrant alike. And above all, the drug addiction with suffering beyond whats even possible to take in. I’m not defending the chinese government at all, I’m simply pointing out that as we are busy pointing fingers at china, russia, north korea, etc, etc - we are going the same way.

[@zhangmichael6489]

Thank you reseaching and sharing the mortgage crisis in China. I already konw the crisis, but don't know it's expanded so widely, especially the vacancy rate is up to 12%.

[@markdeguzman6556]

With more agricultural lands converted to housing projects, commercial lots and industrial plants, next problem will be the food supply for the large population.

[@dondrumpf5422]

Hahaha.. You need to check how much grains China produce every year!! Do you think they are stupid?? Hahaha.. hahaha..

[@markdeguzman6556]

​@@dondrumpf5422 The country’s food self-sufficiency rate has fallen to 76.8 per cent in 2020 from 101.8 per cent in 2000, a ratio that is expected to drop to 65 per cent by 2035, according to Du Ying, former deputy head of the National Development and Reform Commission. China imported a record 164.5 million tonnes of grain in 2021, up 18.1 per cent from a year earlier, official customs data showed. The Central Commission for Discipline Inspection, China’s top anti-corruption body, has launched a special operation to crack down on alleged corruption in grain buying and sales around the country

[@dondrumpf5422]

@@markdeguzman6556 hahaha.. yes, sure. And, they will let it to happen, right?? Hahaha.. hahaha.. hahaha...

[@dondrumpf5422]

@@markdeguzman6556 some reports say China stop importing grains this year!! Hahaha.. hahaha..

[@dondrumpf5422]

@@markdeguzman6556 and, didn't you, China-haters, keep saying that China's population will be halved by 2050, right?? Hahaha.. hahaha.. hahaha....

[@thecrimsondragon9744]

In ancient and medieval times, China was synonymous with quality and high standards. Now anything made in China is of poor quality and to a low standard 90% of the time. And the prices aren't always that cheap, as is typically thought.

[@MeiinUK]

Yeh.. even when there was the state owned enterprises.... The entire country smacked of respect. It's lost its face now. Mao was all about that. Get rid of the old and the traditional and bring in the industrial revolution... Weird isn't it ? ... A lot of people don't participate in the chaos. The so called CCP seems to be a modern version of the imperial system. If you care to notice. They basically used this covid exercise to finally get rid of their enemies too. The old dynasties and their descendents may have been found and killed. That is what is going on...

[@elonmust2693]

China's real estate market is like someone very bad at playing Sim City.

[@chrisanonym3473]

I feel sorry for these people. This not only happen in China but also in Indonesia. In Indonesia, it worse. Often times, they applied bankruptcy and change name and sell this unfinished property to new buyers. There is nothing you can do because developer bribe the judge and prosecutor. So you will lose if you try to sue them. Other times, they will countersue you for defamation. The famous one is Meikarta.

[@wingsyc]

Same in Malaysia.

[@BlueBenz2005]

Wow so corrupted

[@HKim0072]

Here’s the problem: all businesses are corrupt. No one trusts the stock market. So, the investments are limited. But in the US, no one would ever buy an investment property if you couldn’t collect rent and pay the mortgage.

[@quarelay2486]

2008 hours crisis: as if I didn’t happen

[@browncony3897]

This is what you get when a country is governed by one with primary school education …

[@blandwinde]

a common practice in China is the developers demands construction contractors fund the construction and repay the contractors only after they ve sold the apartments still under construction and received banks release of money based on buyers collateral loans. by this practice the developers can qicken further expansion but construction quality is barely acceptable. When the cash chain breaks, contractors cannot get money and will immediately stop construction.

[@bobafett5757]

Why no intervention from Insurance party ?

[@dondrumpf5422]

@@bobafett5757 insurance?? What insurance??

[@ProLim580]

Too many are gamblers & involved in housing speculation which they now finally caught up with them unable to service their loans.

[@Coxman]

We know. That's why it does not work. It's just a Ponzi scheme, not a regulated industry like it is in the west. Those ghost cities not finished, they will be worth nothing. No wonder the people are boycotting their mortgages.

[@censoredyoutube4902]

@@bobafett5757 China doesn't even have enough actuaries. Lol.

[@greatasia606]

New mass market condos in Singapore is S$2000 psf. A small little 1000sqft condo is S$2 million. New Executive condos in Singapore is approaching S$1500 psf. A small little 1000sqft condo is S$1.5 million. HDB 4-rm flats are going at S$400k to S$750k. You should worry for Singapore first.

[@tagontag]

Try harder because your numeracy is too shallow. If you are part of the propaganda machine, try to make better falsification of analysis out of GDP per capita, household median income, how many years of average wages does a house cost in Singapore, and subsidies Singaporeans receive for public housing, before you try to deceive Singaporeans and yourself. For your knowledge, the literacy rate of our younger generation is higher than most OECD countries. Try harder, I clap for you.

[@chenghonggoh4746]

Well I do worry cos alot of rich PRC chinese are escaping from Xi's China to sg, pushing up our property prices.

[@beezlebub9]

We know, we know.

[@kengng8797]

There are still many sg thinking that Singapore is fine. Go check sg feign debts and compare them to other countries.

[@coldheaven2584]

Singapore isn't so bad. With an average income here in vietnam it will take 53 years of saving(it's around 40 in china)to buy a property, the government is corrupt and the politicians own the most real estates so this will not change. All i can do as a citizen is pray that the bubble finally pop

[@sylvesterajah9886]

The blame lays on the government for NOT regulating the bousing development and put proper financial regulations in place. The problems are: lack of laws and regulations governing.property developments.

[@Drrayoldman]

As an American living in China (Chinese wife and daughter) my family has done quite well. We bought our home from Guangzhou's largest developer "Times Building Estate". Pre-construction price for our 3 bedroom home was 8,000rmb per square meter. We paid the mortgage for 2 years before we moved in. It's a magnificent home in a wonderful neighborhood with gardens and playgrounds. It's guarded 24/7 and ultra-safe. Our home now is valued at 19,00rmb per square meter. Some people cut corners and go with a small contractor, but remember... buy cheap, get cheap, or perhaps loose everything

[@jeremypearson6852]

These aren’t “small” contractors, they’re major corporations. Regardless, the buyers should have some government protection if the builder defaults.

[@MoniqueMarine-kt6pn]

These real estates should be kind, if there is no demand there is no increase in payment. It's a legal form of corruption, the unit is just a 1/4 of the people are paying. Make sense you need not to be greedy, it will backfire against you (real states)

[@raidensears5321]

I consider the direct cause of the problem the misuse of funds that should have been kept for each project. Exactly why this is allowed or even intentionally directed is a more complicated questions that requires more investigation.

[@rogerbartlet5720]

Imagine how poorly constructed these buildings are?

[@tanyan6325]

Malaysia has the same system. Pay first for unfinished house.

[@michaelsane.1729]

Guys,Never buy a house you can’t live in.

[@spacerobot4426]

Same greed in profiting from housing happening in Singapore

[@mgronich948]

Yes this is a mess but it's being cleaned up. The govt has allowed people to stop making mortgage payments with no penalty until construction restarts. The govt has also making finaqncing to finish construction of stalled projects. This is months ago. Why is it being repeated now with nothing new?

[@readerviewer9177]

This is a very informative documentary!!

[@marcellathe9430]

Dumped chicken government

[@sheldoncampbell2139]

propping up your economy on the construction of empty cities... this has been reported on for years...

[@HafezBd]

After selling a couple homes in 2020, I'm anticipating a housing crisis in order to buy inexpensively. As a backup plan, I've been thinking about purchasing stocks. What recommendations do you have for the best time to buy? On the one hand, I keep reading and seeing trader earnings of over $500k each week. On the other side, I keep hearing that the market is out of control and experiencing a dead cat bounce. Why does this happen?

[@harod033]

The fact that the US stock market had been on its longest bull run ever makes the widespread worry and enthusiasm understandable given that we are not used to such unstable markets. As you pointed out, it wasn't tough for me to earn over $780k in the last 10 months, so there are chances if you know where to go. I hired a portfolio advisor since I was aware that I needed a solid and trusted plan to survive these trying times.

[@thomasweber5]

@@harod033 I tried looking into new strategies to profit in the current market because my portfolio has been in the dumps for the entire year, but everything I tried just seemed to miss the point. Please let us know who your financial advisor is by name.

[@harod033]

@@thomasweber5 There are many financial coaches who excel in their profession, but for the time being, I employ "Ruth Loralann Brennan because I adore her methods. You can make research and find out more.

[@gregnewgent]

@@harod033 I greatly appreciate it. I'm fortunate to have come upon your message because investing greatly fascinates me. I'll look her up and send her a message. You've truly motivated me. God's blessings on you

[@swoooooooooop]

Beware of suggestions for financial advisors. This smells of a scam

[@cedricvelarde]

I think the country really rushed the urbanization so fast and no fallback.. and for what?

[@rob4197]

What CNA is not telling you is that Beijng is encouraging "social housing" similar to Singapore's HDB. The capitalistic//parasitic/rent seeking housing industry is bad for the economic life of most people if it gets too big.

[@wowokingxoxo]

HDB is also rent seeking.

[@wowokingxoxo]

HDB is also rent seeking.

[@RayMak]

It’s a very sad state

[@FinWonderland]

Actually presales scheme like this is also a common way for developers in Indonesia to finance a project alongside bank finance, even for those credible developers. Buyers even buy based on development plans on paper. But developers have to own the land first. Buyers put heavy trust on those credible developers that permits including clear land status is done. It's also common for projects to be delayed for a year or two, so investors don't fret when one do. Some even more. But by far, most of them are completed eventually, for projects under credible developers.

[@e-money9251]

Yep this is how my father bought our current home, buying them during presale. Good thing that it was bought at the time when the developer, lippo group, was still trusted

[@carolgiangreco6548]

Seems like no one is being held accountable AND the central government is not helping anyone. The poor people who are losing their money and/or their jobs!

[@minyoung823]

The system they made was to make the developers unaccountable to anything. Contractors basically loan materials to build the building, presale buyers got mortgages to provide the cash. When things all went downhill, developers has nothing to do but skip town. 😂

[@MeiinUK]

This is not a good report because this is not the way it was supposed to go. China has like a few world bank offices in there. They just didn't agree with how to raise the country and had zero experiences... Except the old imperial model. This is why it feels still like an imperial model based on grains and agricultural taxes and things. Blind leading the blind, the whole world goes blind...

[@calcrappie8507]

A housing bubble where the cart is in front of the horse. Making payments on a pile of unfinished concrete for years. At least that old guy at the end was getting some vegetables out of the un-landscaped soil in front of the building where he bought a unit.

[@joe2mercs]

The boycott of mortgage repayments is not just a financial headache for the government. While the government would like pre-buyers to continue paying their mortgages in order to keep the real estate business active it is the actual lack of building activity in the first place that is the cause the boycotts. This lack of building activity means that entire supply chain of building materials is being brought to a standstill and this means unemployment on a large scale leading in turn to further mortgage defaults. The very thing that the Chinese government fears and wanted to avoid is happening regardless of what they try to do to stop it.

[@commentorsilensor3734]

Lenders can always foreclose unfinished homes. Wait unfinished? Never mind

[@carollever4662]

Real estate ownership for citizens is a global problem, that if solved with stable home ownership equity and financial security for citizens could save trillions in social services programs

[@geraldbutler4990]

Thieves used to be punished but when the thieves are in control, who's going to punish them?

[@leahcasey2678]

Currently, the average mortgage held in Ontario (Canada) is now over $486,000 - and the 5-year fixed rate mortgage is around 5.4%. That means that the average person in Ontario is required to pay ~$3000/month. With Utilities, taxes and insurance now costing over $12,000/year, the average mortgage holder in Ontario is on the hook to pay over $48,000/year to keep the roof over their head. The average annual salary in Ontario is ~$98,000 - however, their after tax earnings are only $69,000. So, in Ontario, the average after-tax income is $69,000 and the cost of the house they live in is $48,000. The 5-year fixed rate interest rates are expected to further increase by an additional 1.5% by Q2 of 2023.

[@Andrew-xw4zj]

Interesting but how does this relate to the housing crisis in China?

[@sofjanmustopoh7232]

If you think that is bad in Canada. In Shenzhen a 1000 sqft / 93 meter2 apartment around city center is around $800,000. Now calculate Shenzhen average wage vs Canada 🤣. You have no idea how good you have in Canada

[@hazeleyedsoul3282]

Developers and politicians that enabled them should be in jail!!!

[@beezlebub9]

The poor young father at the beginning of the documentary 😢

[@applehair995]

Jack Ma is right in his criticism of the lack of financial regulation in China. This offended Xi Jinping and CCP. Their bruised ego cost Jack Ma everything he has

[@bobafett5757]

*Excellent and well crafted and executed Documentary from CNA Insider you guys did an amazing job*

[@dondrumpf5422]

For this comment, I agree!! But, it doesn't mean that it's the end of the world for China and those good people!! The China's government will find the best solutions for them!! At the end of the day, it's the creditors and speculators that will have to pay!! They will be the ones who will take most of the hits!! If you speculate or buying all those junk bonds, you know the risks!! Agree, old kidd?? Hahaha.. hahaha.. hahaha..

[@pepelondon]

@@dondrumpf5422 oooooo pop pop ooop polo pop 💩 loop 😊

[@dondrumpf5422]

@@pepelondon what happens to you, old kidd!! Are you just enjoying all those BS and poops?? Hahaha.. hahaha.. hahaha.. What a shame!!

[@awesomegmg956]

If you default a mortgage in China, you lost the house PLUS still be responsible of all the remaining mortgage. No personal bankruptcy there.

[@paultaithelegendnguyen8891]

The way they do their mortgage business is totally oppose with the rest of the world. How could we make payments on the unfinished house while we have to rent somewhere else ? Who will pay for the extra expense ?

[@MeiinUK]

They will be like Japan... Created a bubble.. mortgage had to take around 1.5 generation to pay off. Then some people abandon their houses and run off. They don't realise that they are making bubbles. That is the sad thing. Then Japan went into recession for at least 30 years afterwards. A lot of people in the UK either rented their spare room out. Or when their child matures, the child pays maintenance fee to their parents to help out. Rather than to move out or to take on a mortgage ? The latest thing I have read now for the UK is that... Friends... Get together to buy a place. Say three to four people buy a building or a flat. And use the law to segregate and separate the payments. The tools are there... Just depends on if people know how to use it or not.

[@SatabdiKundu07]

Same thing happens in India. My colleague pay her mortgage as well as her rent. She needs to pay a mortgage for 2yrs before she can move to her home if everything goes smooth.

[@galaxymetta5974]

China housing problems start when developers are allowed to collect 40% upfront and with mortgage payment starting immediately. China housing minister drastically failed in his job.

[@happycook6737]

Chinese can't "own" housing still. They rent it for X number of years and that rental is called a "mortgage". They can sell their rental rights which are worth more if there are more years left on the contract. It is a very sad situation. Also apartments means "buying" airspace so if nothing is built you still must pay but no way to use/sell what you bought. Also there is very little quality control in construction which means many buildings rot quickly, sometimes collapse, no maintenance is done to the concrete structures, etc.

[@dondrumpf5422]

Hahaha.. hahaha.. Yes, it's true for few cases!! Do you know there are around 600 millions houses in China??

[@dondrumpf5422]

If you buy an apartment in United Satans of AmeriKKKa, or in Canada, or EU, or Australiar, or Singapore, just check how long you "rent" that unit you buy!! Hahaha.. hahaha.. hahaha..

[@parkerbohnn]

That's exactly correct all of them are 65 year leaseholds so in reality they own nothing 65 years in the future. The Chinese government is just leasing all of these development's to its citizens. Has to be the worst possible investment in the entire history of the universe not just planet Earth's history.😂

[@kengng8797]

Singapore you buy a house is only a 99 year lease 😂😂. That's true for many cities. Why are there idiots still is only China?

[@adamantium2012]

@@dondrumpf5422 - The only satans are in your ccp party and the extreme left commies in the west. Looking for a free ride instead of building something.

[@gregorywilson2124]

Why are they still paying for unfinished properties? They should get their investment back plus money for breach of contract and stress. This is criminal.

[@gadenp81]

I love CNA, what America and Indian New outlets turn into whack a china articles or videos. CNA actually tell the true story.

[@HKim0072]

It’s covered fairly. Mostly, by the business publications. The average American could care less about news about China.

[@oahuhawaii2141]

@HKim0072: it's "couldn't care less".

[@tedzehnder961]

When people in China buy land to speculate with do they pay taxes on the property`s worth? If they had to pay taxes on it(Even for undeveloped land)right away, they would not have tried to gamble/ gobble up the vacant land as fast and would build in a timely manner. Tax laws on unfinished building projects favor the developer so they won`t bother to get them finished in a timely manner.Shady developers not honoring time schedules should have been sued and tax laws and regulations should have weeded out bad operators. Government tax proceeds could have finished some projects where laws and regulations were followed.Speculators who don`t honor contracts should end up in court. People in government (officials) who didn`t make sure laws and regulations were adhered to should be sent to prison. Tax laws curb exuberance of criminal behavior.

[@llg4116]

I am another example for investing in the real estate market in China since 2000 and starting to sell properties in 2015 when policy and market have changed. I am able to retire in my 40’s. There are unfortunate cases happened but it’s still a small percentage amount compared to the huge market. Investment always takes risk and needs to do a lot homework. I feel sorry for those people who bought off-plan property. It’s cheaper but has uncertainty risk as futures trading. Recently Chinese government launched aiding project to help completing those properties. Hope those people will get what they have paid for.

[@peterlee6148]

A good wake up lesson.there is no such thing as free lunch

[@recalltolife3478]

"a small percentage"? You've got to be kidding.

[@franklinocha4439]

in my country, it's far more wonderful. People pay upfront fees, sign up for a mortgage, the projects go bust, units are never handed over, but those people have to keep paying the installments or they risk their name put in the bad credit-scoring list; some buyers have even settled in full payment; then they take to the street to demand their money; yet the developer sued them, pursued legal proceedings against some of those who yell the loudest .... until the management of the developer got invited to the chamber of the House for a hearing ....... to this day, i have no idea if those buyers have got their unit .....

[@khale7180]

Imagine 50% of household wealth disappeared.

[@lovelydiva06]

Why is this even allowed to continue, it’s such a waste of resources land and peoples money, all these ghost cities of real estate rotting away, china is gonna see themselves slowly dropping to the bottom if they keep this up cause you can’t sustain continuously doing such things just sad smh

[@mishap00]

I wonder if there is any way that the people living in the RTB for 20-25 years could get title to the building and finish it one building at a time. Maybe make a deal with the bank holding the mortgages to split profits and at least get a liability off their books? I have no idea if that would be allowed in China...probably not, but it would at least allow people to have decent homes that they are paying for already or have paid for given the length of time since work stopped.

[@MH_Bikes]

It's quite possible that "wet markets" besides being disgusting are also unhealthy. Look at what's happened.

[@bobafett5757]

*Those unfinished left to rot buildings look really haunted and the structure may not last for a long time due to harsh weather exposure*

[@dondrumpf5422]

Hahaha.. hahaha.. hahaha... Really?? You seem to know "much" about civil engineering, isn't it, old kidd?? Hahaha.. hahaha.. hahaha..

[@bobafett5757]

@@dondrumpf5422 Think u must have some unfinished Meds to complete Kiddo 😁

[@dondrumpf5422]

@@bobafett5757 hahaha.. hahaha.. you mean you yourself, old kidd?? Hahaha.. hahaha.. hahaha.. So very funny!! Hahaha.. hahaha.. hahaha.. What a shameless brainless childish hypocrite Iiar hater loser sad soul jealous joker clown old cringey sheep kidd!! Hahaha.. hahaha.. hahaha.. What a shame!!

[@dondrumpf5422]

@@bobafett5757 When you start to think that China is all bad, and United Satans of AmeriKKKa is all good, then you know that you are becoming delusional, old kidd!! Hahaha.. hahaha.. hahaha... Go see your shrink, old kidd!! You need help!! Seriously!! Hahaha.. hahaha.. hahaha...

[@abdurrahmanasal7553]

From 45:40 to 46:20 China's continued success is a success for the whole world.

[@santyasanuma6114]

families are families regardless of where they are in the world. action must be taken to help these families who have been denied, or maybe cheated, in getting to their homes