Josh Brown at TheReformedBroker is fascinated by and scared of the Chinese growth story for good reason. On the truly scary side, he highlights the home market paragraph below from David Leonhardt’s NYT feature on China. Post-boom U.S. Realtors take heart: you’ve (probably!) never resorted to setting up shop on the sidewalk. This reminds me of Dubai’s waning go-go days exactly two years ago, when 20-something realtors boasted millions just before fleeing and leaving Mercedes keys on dashboards in airport parking lots. But Brown—a NY-based investment advisor—knows China is no Dubai, and his clients will surely benefit from select opportunities that his China fascination uncovers.
FROM NYT: “This unsustainability is especially pronounced in the current real estate mania. Housing prices have been soaring, despite government efforts to cool the market. Relative to rents, housing prices in Beijing, Shanghai and Hangzhou are higher than they were in most any American city at the peak of our housing bubble. In Beijing or Shanghai, four or five different real estate agencies might open on a single block. Other agents simply set up shop on the sidewalk, with a table and brochures. At traffic lights in Beijing, young men walk among the idling cars and hand out brochures for newly built apartments.”