Foreigners Piling Into Hong Kong Homes



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ORIGINAL POST

POSTED BY Ed (8 mths ago)
Overseas purchases of 250 homes in September, a 14-month high
Chinese buyers account for 31% of homes worth at least $2.6m

A surge in purchases of Hong Kong homes by non-residents offers one explanation for what’s driven an 11 percent rebound in property prices from a March bottom.

In September, 250 homes were sold to non-resident foreigners, the most in 14 months, according to data from Hong Kong’s Inland Revenue Department. That compares with a low of 62 homes going to foreign buyers in February, just before the nadir of Hong Kong’s property market a month later. While the revenue department does not give a breakdown on nationality, analysts and developers say mainland Chinese are the biggest foreign buyers.

http://www.bloomberg.com/news/articles/2016-10-19/foreigners-piling-into-hong-kong-homes-help-drive-price-rebound

COMMENTS

gdep (8 mths ago)
There are 1.4 billion Chinese , 100 billionaires, a million millionaires, will be 2 million of them by 2020 as per http://www.scmp.com/news/china/money-wealth/article/1867321/china-be-top-ten-nation-us-dollar-millionaires-2020

how many new apartments in HK? do the math.. HK property as an asset, HK as an alternative base is very attractive for mainland people ..hard to see the downside. (unless govt completely bans non-premanent hkid buyers from the market, and disallows hkid buyers from buying more than 1 property.. almost impossible?? )

Ed (8 mths ago)
There is the issue of what many see as a house of cards across the border....


Chart shows China’s debt bubble bigger than subprime bubble
http://www.marketwatch.com/story/chart-shows-chinas-debt-bubble-bigger-than-subprime-bubble-2016-05-31

http://ei.marketwatch.com//Multimedia/2016/05/31/Photos/NS/MW-EO061_Slok05_20160531113902_NS.jpg?uuid=ccc16b34-2745-11e6-9687-0015c588dfa6


China debt load reaches record high as risk to economy mounts
US-style credit crunch or Japan-style grinding malaise seen as increasingly likely
https://www.ft.com/content/acd3f2fc-084a-11e6-876d-b823056b209b



Some prominent investors are worried about China’s debt. George Soros sees an “eerie resemblance” between conditions in China now and those in the U.S. leading up to the financial crisis in 2008. “It’s similarly fueled by credit growth and an eventually unsustainable extension of credit,” Soros told the Asia Society in New York in April.
http://www.bloomberg.com/news/articles/2016-08-28/digging-into-china-s-growing-mountain-of-debt


China's growth sucks in more debt bucks for less bang | Reuters
http://www.reuters.com/article/us-china-economy-debt-idUSKCN10400K



The strategy of keeping GDP ticking along by building stuff that is not needed (and generating no return)... and running up epic amounts of debt in doing so..... has its limits....




China Shocker: A Quarter Of All Companies Can't Pay The Interest On Their Debt

Profits at roughly a quarter of Chinese companies in a Reuters analysis were too low in the first half of this year to cover their debt servicing obligations, as earnings languish and loan burdens increase.

Instead, lenders are heeding Beijing's call to support the real economy and so are rolling over company debt or granting repayment waivers, sometimes for years, specialist lawyers and investors said.

At one large, state-owned Hong Kong-listed developer, whose profits no longer cover its interest cost, an official said the outlook was still positive for loans.

http://www.reuters.com/article/us-china-corporate-debt-idUSKCN1240NThttp://www.reuters.com/article/us-china-corporate-debt-idUSKCN1240NT

Ed (8 mths ago)
Where the Next Crisis Will Come From

China may be the scariest source of risk on the horizon. Its growth rate has been driven by unsustainably rapid expansion of lending to businesses and households, says Bloomberg Intelligence Chief Asia Economist Tom Orlik.

Chinese banks are “the major risk, a potential detonator,” says Samuel Malone, director of specialized modeling at Moody’s Analytics.

He looked at the size, fragility, and interconnectedness of the world’s biggest banks and concluded that China’s Southeast Asian neighbors, particularly Singapore, are most directly exposed. China’s shadow banking system is huge and poorly understood, and the losses that it suffers could quickly be transmitted to conventional banks.

http://www.bloomberg.com/news/articles/2016-10-20/where-the-next-crisis-will-come-from


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