In China, They Do Ring a Bell at the Top

FT: China house price surge is over, says statistician
China’s chief statistician has called an end to roaring house price inflation. The sector’s “high-growth period is over”, said Sheng Laiyun, head of the National Bureau of Statistics.

...Real estate investment and sales slowed for the third successive month in July, suggesting that economic growth would moderate in the third quarter after increasing 6.7 per cent over the first six months of this year.

The sector contributed 15 per cent of economic growth in the first quarter, according to government statistics; a figure that swells further if related sectors such as cement, iron and other materials are included.

Chi Lo, senior economist at BNP Paribas Investment Partners, estimates that the real estate sector ultimately accounts for more than half of total economic investment.
To review: China Mortgage Lending Grows 32.2pc in 1H 2016, Leverage Soars and China's Monetary Cycle Driven By Real Estate. China managed to salvage economic growth with a credit boom and a real estate boomlet. Now, Real Estate Investment Growth Slows to 1.4pc in July and on pace to slide back into contraction; in July, Residential Mortgages Account for 102pc of Lending Growth, Rate Cut Coming.

Where is growth, specifically credit growth going to come from? Local Govts to Spend Trillions in Second Half Infrastructure Push, but will these be enough to offset falling real estate related credit growth and falling land sales? Related: Real Estate Boomlet Ending, Now What?

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