Excerpt
2024, Opinion: "Are China’s real estate problems different? When we published our paper “Peak China Housing” (based on pre-COVID data) in 2020, our thesis—that China was facing a difficult transition from real-estate-led growth to more balanced growth— was far out of consensus. Most experts believed that any slowing of China’s property price and con struction boom would be very gradual, with little impact on trend growth. True, China’s house prices had risen tenfold since the early 1990s—an order of magnitude greater than the housing price increases experi enced by Ireland, Spain, and the United States in the run-up to the 2008–09 global financial crisis. But China’s prices were growing from an extremely low base, with the price of a one-bedroom apart ment in the center of Beijing still only 25 percent of a similar apartment in Manhattan. Moreover, the Chinese economy had enjoyed spectacular growth for four decades, and most experts were projecting only a modest slowdown."