Big American Stocks, New Chinese Home Prices "Can't" Go Down

For years, investors have noticed that houses are to China what stocks are to the USA. Both countries rely on this primary wealth asset for "saving" and investing. Both nation's governments and central banks are fixated on the price. Both central banks unleash massive intervention when this asset depreciates. The only difference right now is that China is worried about blowing another bubble, while Powell and the Fed want the biggest bubble in history.

21st Century: 一二线城市局部过热已出现 二手房流动性风险潜伏

The outbreak did not seem to affect the property market much.

In the opening year of the Shenzhen property market, there has been a wave of magic quotes and a new trend, which seems to have caused some other cities to start to catch fire.

Last month, Hangzhou's record-breaking 50,000 people rushed to grab a house, attracting the attention of the people across the country. In Nanjing, Chengdu and other places, a similar phenomenon of "new innovation" has also appeared.

But investing in new houses will eventually be realized in the second-hand housing market. In most cities, new houses are hot, but second-hand houses are very weak. While the number of listings has soared, the liquidity is very poor, and there is no market for price.

It is not always possible to make new money. In the future, under the regulation direction of "no housing, no speculation" in the real estate market, it is difficult for the difference in the price of a second-hand house to have the profitability in the past.

This is a mirror image of the U.S. stock market. BigTech stocks are leading the market higher as smaller value companies fade away. Long-term returns on houses are going to be low in China and long-term returns on U.S. stocks will be low as well.

As for the current situation, there's speculative fever in Shanghai, Nanjing and Shenzhen. Hangzhou's housing fever was strong enough to freeze the cities' lottery system:

Hangzhou, which is next to it, also gave birth to the "50,000 Shake" that shocked the whole country.

At the beginning of June, Hangzhou Ocean Ocean Xixi Mansion launched 959 suites, which attracted 50,000 registrations and set a record. The profit-making expectations under the price limit attracted buyers to enter the market, and everyone wanted to make a big profit.

On the other side, the last batch of houses was launched in the happiness zone of Vientiane City in the north of the city, which attracted 20,000 shakers. The two hot disks met directly, which directly led to the paralysis of the Hangzhou shake number registration system.

In Guangzhou, existing home sales are weak with listing rising:

n Guangzhou, an intermediary said that the existing housing in Guangzhou is very embarrassing. Most sellers refuse to lower prices, but buyers feel that they will drop again and have been deadlocked for a long time. There are a lot of listings that can't help but cut prices.

Many property owners told reporters that the housing prices in their communities have dropped by about 5,000/flat this year.

On Lianjia's official website, the current number of existing housing listings in Guangzhou exceeds 70,000 units. Compared with June last year, the number of existing housing listings has just exceeded 50,000 units, which has increased by 20,000 units a year. Sufficient housing volume gives buyers more room for bargaining.

According to data from Guangzhou Central Plains Research Institute, in the second week of June, there were 1089 existing home residential transactions in Guangzhou, a decrease of 3.2% from the previous month.