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Beijing Alone Has 50% More Vacant Housing Than The US

Tyler Durden's picture


Putting some housing things into perspective. From the (less than credible) NAR:

Total housing inventory at the end of April rose 9.5 percent to 2.54 million existing homes available for sale, a seasonal increase which represents a 6.6-month supply at the current sales pace, up from a 6.2-month supply in March.  Listed inventory is 20.6 percent below a year ago when there was a 9.1-month supply; the record for unsold inventory was 4.04 million in July 2007.

Meanwhile, half a world away, from a just released report in Beijing News (google translated):

The Beijing Public Security Bureau Population Administration Department said yesterday that have checked the information of the mobile population 725.5 million, mark the rental housing 1.39 million, checking vacant houses to 3.812 million.

So, broadly speaking: US: 2.5 million available homes; Beijing - one city in China - has 3.8 million??

That is all.


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Tue, 06/05/2012 - 09:59 | 2495703 Zgangsta
Zgangsta's picture

All they have to deal is repeal the One Child Per Family policy, and problem solved!

Tue, 06/05/2012 - 10:03 | 2495726 Pladizow
Pladizow's picture

Not surprising as their population is 4X the US.

Tue, 06/05/2012 - 10:10 | 2495748 markmotive
markmotive's picture

China is the disaster on pg16 that nobody talks about.

Tue, 06/05/2012 - 10:29 | 2495799 hedgeless_horseman
hedgeless_horseman's picture



Q: How does one say buyer's market in pinyin?

A: Wi Long Shan Ti.


Tue, 06/05/2012 - 10:47 | 2495856 redpill
redpill's picture

Whoah whoah whoah, there is a big difference between NAR homes for sale and vacant housing.  Most of those NAR homes for sale have people living in them. 

A better comparison (although potentially no more statistically trustworthy) would be the Census Vacancy statistics which are compiled quarterly.

See Table 3.  As of 1Q 2012, there were 18.4 million vacant housing units in the US, 4.4 million of them are seasonally vacant, the other 14 million are for rent (3.8 million), for sale (1.6 million, this would be the fraction of the NAR number that is actually vacant), and 7.6 million held off the market by the owners.


The Beijing number is still notable, however.  The equivalent would be the entire Northeast region of the United States, which accounts for about 20% of those vacancy stats (3.6 million total).

Tue, 06/05/2012 - 10:55 | 2495899 Comay Mierda
Comay Mierda's picture

A Bubber of Ronery Houses

Tue, 06/05/2012 - 11:44 | 2496086 Aziz
Aziz's picture

Central planning wins again.

Tue, 06/05/2012 - 10:58 | 2495910 kaa1016
kaa1016's picture

Redpill, good job. Like they say, never let the facts get in the way of a good story.

Tue, 06/05/2012 - 10:27 | 2495807 Muppet Pimp
Muppet Pimp's picture

Jim O'Neill told me that for China, with their streamlined central planning authority has nothing to worry about.  The real problem says Jim is the remaining democratic regimes around the world.

Tue, 06/05/2012 - 10:42 | 2495851 BudFox2012
BudFox2012's picture

Very true.  In China's mad dash to crank up the internal consumption end of their economy, they are creating some massive bubbles of their own.

Tue, 06/05/2012 - 12:11 | 2496164 cougar_w
cougar_w's picture

Nothing about a housing bubble that cannot be fixed by a bulldozer bubble.

And notice, they employ the same people either way.

Tue, 06/05/2012 - 12:20 | 2496203 Arthor Bearing
Arthor Bearing's picture

Step 1. Build House
Step 2. Destroy House

Repeat until you run out of gasoline and fresh water, then shit your pants. 

Tue, 06/05/2012 - 13:03 | 2496339 fourchan
fourchan's picture

our bubble is their bubble, our depression will be their depression.

Tue, 06/05/2012 - 10:12 | 2495755 Ruffcut
Ruffcut's picture

Just like the heads in DC. "Knock, Knock, ..... nobodies home."

Tue, 06/05/2012 - 10:27 | 2495802 The Big Ching-aso
The Big Ching-aso's picture



Ya, but at least we have people not paying mortgages occupying houses that should be vacant.

Tue, 06/05/2012 - 11:07 | 2495943 JPM Hater001
JPM Hater001's picture

About to be 3X's.  They really like to fight amongst themselves in China.  History shows a great propensity to fracture and this time...aint no wall high enough.

I do have to note it will be interesting to watch China fight China with shit made in China.  That's really going to have some really disappointing moments.

Tue, 06/05/2012 - 12:10 | 2496162 dirtbagger
dirtbagger's picture

The real key is housing affordability.  Despite the image that China promotes, there is a huge population that is at or near the poverty level.   One can easily forget this in the showcase cities like Bejing and Shanghai. 

Much of this excess housing was built solely for investment purposes and will remain vacant for years.

Tue, 06/05/2012 - 23:36 | 2498319 Buck Johnson
Buck Johnson's picture

And that is why they are eyeing Australia, Canada and the US eventually.  They need a place to put their excess population.

Tue, 06/05/2012 - 10:24 | 2495795 antaresteleko
antaresteleko's picture

That's nothing. In Spain alone we have more than 3 million empty dwellings...

FYI, Spain's population is less than 48 Million people.

Tue, 06/05/2012 - 10:44 | 2495860 ronaldawg
ronaldawg's picture

Bejing is an awesome city- not what you would think for a Communist/Facist country - Also they have incredible hookers.

Tue, 06/05/2012 - 11:10 | 2495956 JPM Hater001
JPM Hater001's picture

Let's be fair...the nice thing about hookers in Bejing is you dont have to tip them.

Tipping is considered propositioning...

Wed, 06/06/2012 - 05:23 | 2498614 K_I_T_T_Y
K_I_T_T_Y's picture

At least the hookers are not the in other places...

Tue, 06/05/2012 - 16:31 | 2497286 JeffB
JeffB's picture

Some things can be fast tracked, but even if everyone got crankin' & they induced labor early, I imagine it would be at least a few years before they'd have burgeoning new families with capital and good jobs looking for housing.



Tue, 06/05/2012 - 10:00 | 2495705 sabra1
sabra1's picture

if only those homes were in canada!

Tue, 06/05/2012 - 10:21 | 2495789 TrainWreck1
TrainWreck1's picture

They would be igloos...

Tue, 06/05/2012 - 10:27 | 2495805 Unbezahlbar
Unbezahlbar's picture
Vancouver home prices fall for fifth consecutive month

Tue, 06/05/2012 - 10:00 | 2495708 achmachat
achmachat's picture

having lived in Beijing for a long time, I can tell you that those numbers surely include small rooms for rent, and places you wouldn't even put your mother in law.

Tue, 06/05/2012 - 10:01 | 2495719 LFMayor
LFMayor's picture

try me

Tue, 06/05/2012 - 10:14 | 2495764 Ruffcut
Ruffcut's picture

My mother outlaw is too fat and wouldn't fit.

Tue, 06/05/2012 - 10:09 | 2495744 K_I_T_T_Y
K_I_T_T_Y's picture

and that most of the property where paid cash upfront....

Tue, 06/05/2012 - 10:38 | 2495838 laomei
laomei's picture

No only that, but there is a massive migrant population with numbers that don't quite add up unless you are counting them living in very cramped quarters.  Hard to get any real numbers as no one will ever admit to it as tax is owed on rental income.  Also, vacant untouched is simply worth more than furnished, as there are renovation cost considerations involved.


It is very very very common to snap up properties in cash up front to secure future holdings for parents and for children.  People living in cramped quarters are saving up to buy their own places.  It's not really all that crazy if you fully understand the way things work here.

Tue, 06/05/2012 - 10:46 | 2495863 Muppet Pimp
Muppet Pimp's picture

Can you elaborate on how things work there?  Just curious, because from over here it looks like a big CF.  

OT: What is with the chinese children running around without diapers crapping all over the place, like the floors of retail malls and in the hotel lobby? 

Tue, 06/05/2012 - 14:55 | 2496885 laomei
laomei's picture

Most of the generation of childbearing age were not raised in a world of diapers. There's also a weird concept of infant shit and piss being clean.  Why waste money on diapers?  The kid'll figure it out soon enough.


Generally speaking, housing used to essentially be a guaranteed thing that was assigned and rented out for token sums.  That changed when the ability to purchase was introduced as it was believed that it would make housing more efficient.  No one cared at first, then they started jacking up the rents


Eventually, pretty much all of the old company housing was converted to private ownership.  Do remember of course that the company was pretty much your life.  The companies had their fingers in many sectors and was entirely possible to move within the system and change companies with permission.  Housing, food, education, retirement, medical care, all provided by the company.  As housing was assigned, basically you lived surrounded by your coworkers families.


So, back to present day, that "iron rice bowl" has more or less been smashed and it's up to you to make your own and provide for the next generation.  There are no property taxes and the taxes that are being trialed are focused on landlords and the very top.  If you have it paid in full, it's yours as long as it's not illegal construction (and there are always signs of it if you bother to pay attention).  Housing in the right locations opens up massive benefits to your children, especially in terms of schools.  Owning a house is actually a massive asset that has the potential to play a role in hukou changes in the future as well.  Beijing is on the top of the list of desirable hukous and owning property here is seen as a long term investment.

1) Society says you need a house to get married.  Having that ready to go for your kid is a big thing and gives them a huge advantage in getting started in life.  For non-locals, having an extra property or two for parents or relatives to retire in or use as a guest apartment is also a thing to do.

2) Rent can be a new iron rice bowl if done correctly, providing stable income in retirement

3) Investment properties need to be kept barebones.  Apartments here come as concrete shells with subfloor and whatnot.  No one really likes "used" housing when they can get "new" instead.

4) There is a HUGE flow of migrants to the cities from the countryside, many of them intend to stay in the cities and use a combination of personal and family savings to purchase properties.  Having desireable empty units is a big deal.

5) Speculators have effectively been shut out of the market for the time being and the government is actively pushing prices lower.  Most speculators bought prior to the height of the bubble and there is still massive demand, but it's pent up.  There's zero reason to sell any of the stock on hand with the exception of needing quick funds for business ventures.  With the difficulties of acquiring multiple units now, again, it's an asset worth sitting on.

6) Housing is commonly used as a liquid asset in settlements.  Having multiple units to your name is a smart thing to do.


The pricing was definitely a bubble driven by speculation, however the vast vast majority of it is either paid in full, or was purchased with a loan prior to the bubble.  The bubble only really took off after the US screwed the global economy prompting a flight to the housing market for safety.  With the prices now under control the next focus is on driving down the rents.   Yes there are "house slaves" now who are pissy about getting loans on the way down, however the downpayments are much higher than the US requires, all mortgages are full-recourse and proof of ability to make payments is rather strict.  I personally know a few people who got caught, and their reaction to it has been to start side-companies and do some moonlighting for extra cash.  Not extra cash to spend, extra cash to pay off the loans faster.  Despite what some reports may tell you, it's very easy to live here on the cheap, and that's what most people do.

Yes, there are empty units, no it's not really a big issue.  They are vacant because the owner wants them to be vacant, not because the banks seized them and are afraid of making a further mockery of their book valuations that they require for solvancy.

Tue, 06/05/2012 - 15:35 | 2497063 Kiwi Pete
Kiwi Pete's picture

Thanks for that laomei. It's always great to have a first hand perspective.

Tue, 06/05/2012 - 16:18 | 2497249 ffart
ffart's picture

So basically "houses" are just monetary units in China? 

Tue, 06/05/2012 - 16:38 | 2497313 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

I wonder how many China bears (Chanos etc) have never even been there, don't speak the language, and don't have a clue about some of these cultural differences. Thanks for this interesting post.

Not saying I'm a buyer...but maybe it's time to close my AUD shorts...for now, anyway

Wed, 06/06/2012 - 05:21 | 2498612 K_I_T_T_Y
K_I_T_T_Y's picture

Went to Shanghai for the first time of my life 1 month ago.

I know and understand a little of the chinese culture. I can really confirm that what I saw and what I heard from local people reflects what you say.

I think the biggest advantage of chinese people is that they know that they have to count only on themselves for pension and benefit.

In developed countries like US and Europe, people start to think I am entitled to receive this and that from the government... forget it. You are part of your country. You are financing you own pension fund, your benefits and this of many others.... Of course I think it is correct to help weaker people in the system... but if everybody starts to think that he is entitled to something nobody left to pay it.

In China you may have a problem with the poorer, but everyone knows that it's up to them!

Tue, 06/05/2012 - 10:24 | 2495796 fnordfnordfnord
fnordfnordfnord's picture

Yup, what achmachat said.

Tue, 06/05/2012 - 10:00 | 2495710 mrktwtch2
mrktwtch2's picture

well thats not good..but what do you expect from a lying comminist country?? i grew up in the 70's and 80's listening to all the prpaganda about how well the ussr was doing or how japan was going to take over the did that work out??

Tue, 06/05/2012 - 10:11 | 2495752 Hippocratic Oaf
Hippocratic Oaf's picture

U mean the good ol' USA?

Tue, 06/05/2012 - 10:11 | 2495754 K_I_T_T_Y
K_I_T_T_Y's picture

who is communist??? China? Are you sure?

Tue, 06/05/2012 - 10:25 | 2495800 Jreb
Jreb's picture

No. They are fascists. We are all fascists now.

Tue, 06/05/2012 - 10:00 | 2495714 I think I need ...
I think I need to buy a gun's picture

Here is a question....Did they just simply build their infrastructure "with dollars" before the new system comes into play and infrastructure would be more expensive to build. anyone have any thoughts on that.....

Tue, 06/05/2012 - 10:38 | 2495837 ParkAveFlasher
ParkAveFlasher's picture

So what you are saying is that the building boom is a pre-inflation hedge to offset the implied future worthlessness of their dollar-denominated bonds.  That's such a good catch.  My thoughts are that the western concept of "home" is 3 bedroom, 2 bath, picket fence, etc. however I would like to know if this report would be better understood if by "home" they meant "built unit".  Meaning cubes arranged in buildings, which in this day and age, can be used for anything imaginable, if partitioned, piped, and/or wired correctly.  The structural differences between an apt complex, a prison, and hive of business and commerce are negligible. 

Tue, 06/05/2012 - 10:41 | 2495849 MachoMan
MachoMan's picture

Like all trades, timing is of importance...  If you build shit quality structures in a quick and haphazard manner that end up crumbling or otherwise deteriorating before the "new system" comes into play, then have you really gained anything?  The trick is to presume that central planning is a failure...  and that central planners misallocate capital... 

The other question is...  why would it be more expensive to build for the world's manufacturing center post collapse of the dollar?  Do they have a shortage of labor or something?  I see no reason to believe that there would be any marginal increase in the cost to build these structures in the future...  in fact, it seems the risk is to the downside.

Tue, 06/05/2012 - 12:09 | 2496156 ParkAveFlasher
ParkAveFlasher's picture

China can have a labor shortage if they have an energy shortage, if the petrodollar collapses, or if China oil import payment conduits are thwarted.  All mean lapses in the oil supply that powers the current massive mobilization of manpower about the country. 


Tue, 06/05/2012 - 10:01 | 2495715 LFMayor
LFMayor's picture

Well if they'd quit fucking shooting and running over so many of their citizens with tanks, maybe those god damn houses would start filling up.

Tue, 06/05/2012 - 10:01 | 2495716 Cognitive Dissonance
Cognitive Dissonance's picture

I bet the Chinese have more outhouses than we do as well.

Modern crap house

Tue, 06/05/2012 - 10:02 | 2495723 LFMayor
LFMayor's picture

no, they just squat on the side of the road and offload.  Isn't that right AnAnon?

Tue, 06/05/2012 - 11:14 | 2495974 JPM Hater001
JPM Hater001's picture

Actually they squat in the stalls...its really nasty.  You want to find the 4 star toilets.  Those are westernized...

True story had dinner in the Great Hall of the People and they have squat stalls.

I never used one so I cant tell you if there was toilet paper in them or not.

Tue, 06/05/2012 - 13:01 | 2496335 General Decline
General Decline's picture

No. They don't have any toilet paper. I learned this the hard way. A little advice... When you travel internationally, it's BYOTP.

Tue, 06/05/2012 - 14:10 | 2496614 Cathartes Aura
Cathartes Aura's picture

just for the record, I remember traveling in Europe and encountering many different versions of "toilet" - including the squat types - so it's not just a "china" thing. . . 

also remember clubbing in Antwerp, which went on till dawn & involved stopping in at least half a dozen spaces for music, dancing - toilet facilities there also varied widely - including brick walls, waist high, along the sidewalk paths - they had concrete/stone floors & drained to "sewers" - men would line up facing the sidewalks, pissing while others passed. . .  summer, not so pleasant odor-wise.

some of the most beautiful places in the world pre-date amrkn porcelain thrones - best get used to a global norm yankee, one day your sewers will be full.

Tue, 06/05/2012 - 11:16 | 2495977 The Big Ching-aso
The Big Ching-aso's picture



Shit.    I didn't know JPM has branches over there.

Tue, 06/05/2012 - 12:23 | 2496211 JPM Hater001
JPM Hater001's picture

Are you kidding I have a branch at your mom's house...or in or something like that.

Tue, 06/05/2012 - 10:02 | 2495722 jazze
jazze's picture

Tyler- Google translate sometimes has trouble translating the Chinese numbers. Are you sure its not 381*1000 instead of 381*10,000?

Tue, 06/05/2012 - 10:05 | 2495729 taniquetil
taniquetil's picture

Tyler is correct.The character ? is 10,0000.


Here is proof:

Tue, 06/05/2012 - 14:00 | 2496561 Zeilschip
Zeilschip's picture

Yeah it's 10,000. So 381,200 vacant houses in Beijing. Shocking...

Tue, 06/05/2012 - 10:05 | 2495728 MFL8240
MFL8240's picture

So what, The Chinese have 3 Trillion in reserves and the US is 16 Trillion in debt.

Tue, 06/05/2012 - 13:56 | 2496527 kalasend
kalasend's picture

Another mofo who don't know what foreign reserve means.

Tue, 06/05/2012 - 10:06 | 2495735 Seasmoke
Seasmoke's picture

Since they have over 4 times as many people, the US housing market is in much worse shape and nowhere near a bottom

Tue, 06/05/2012 - 10:14 | 2495767 Silver Bully
Silver Bully's picture

Correct. This article only looks at Beijing. Does ANYONE have a true idea how many HOMES (not broom closets for rent) are for sale in China? All I get is a vague suggestion with this article.

Tue, 06/05/2012 - 10:20 | 2495786 XitSam
XitSam's picture

How much shadow inventory does each country have?

Tue, 06/05/2012 - 11:39 | 2496061 oddjob
oddjob's picture

That news is out at 5 pm.

Wed, 06/06/2012 - 07:05 | 2498682 icanhasbailout
icanhasbailout's picture

Seriously... this may be a factor of the Chinese reporting their figures more honestly than the US does. Our shadow inventory was 9 million and not dropping last I looked...

Tue, 06/05/2012 - 10:30 | 2495814 ThirdWorldDude
ThirdWorldDude's picture

Better to ask how many ghost cities are there in China (so far).

Tue, 06/05/2012 - 10:07 | 2495737 the 300000000th...
the 300000000th percent's picture

Evacuate the Japanese from the radiation ridden Japan Island into those vacant Chinese homes

Tue, 06/05/2012 - 10:20 | 2495783 LFMayor
LFMayor's picture

They tried that back in the 1930's.  I read about it and it didn't work out so well.

Tue, 06/05/2012 - 10:10 | 2495746 ArrestBobRubin
ArrestBobRubin's picture

And ZH spends about 50% more time then is useful looking into China's back yard, and worse, mostly through Western mediavision lenses.


Tue, 06/05/2012 - 10:20 | 2495785 narnia
narnia's picture

If you think massive bank runs in China- a country without deposit insurance I might add- will not have a more material affect on global trade than Greece or Spain collapsing, you're as dumb as your post. The deposits in China are as worthless as any other sovereign in the world, they just play a better character on tv.

Tue, 06/05/2012 - 10:41 | 2495847 laomei
laomei's picture

I can walk into any bank here and buy gold and silver.  How about you?

Tue, 06/05/2012 - 10:59 | 2495912 malikai
malikai's picture

Absolutely right. I'll add that I even bought gold at a government store in Beijing, paying spot plus a very small premium relative to what I get in Britain or in the states. 

Tue, 06/05/2012 - 11:07 | 2495942 narnia
narnia's picture

So, does that make Yuan deposits any more valuable than the shadow city or UST collateral on which they are based?

Tue, 06/05/2012 - 11:31 | 2496037 Tirpitz
Tirpitz's picture

That depends a lot on whether the Chinese banks have another 700 trillion USD in crumbling derivative cards coming down onto their balance sheetz.

Tue, 06/05/2012 - 11:28 | 2496019 LFMayor
LFMayor's picture

I can type that my town mayor is a bumbling idiot and that my government is oppresive and fiscally irresposible.

Now you try it.

Tue, 06/05/2012 - 12:55 | 2496306 Overfed
Overfed's picture

I can walk into my local coin shop and buy gold and silver all day long with a very small premium ($1.15 silver, $10 gold) over spot. "Junk" silver coins at spot. I and everybody else in town who aren't still sleeping run out of cash before they run out of PMs. What's yer point?

Tue, 06/05/2012 - 14:41 | 2496803 Cathartes Aura
Cathartes Aura's picture

maybe the point is that China and amrka are not polar opposites, that gradually they are meeting up nearer the middle, and while there are differences, perhaps yankee folk might want to climb down off the high horsie?

which, of course, is a useful humbling of the mind that will come in handy in the months, years, to come.

Tue, 06/05/2012 - 15:07 | 2496929 laomei
laomei's picture

That's a fairly high premium actually.  On investment grade gold and silver here the premium is basically nothing.  I can literally use the bank interface, buy gold futures and take delivery.  Zero risk of fakes and it will be delivered in an armored truck.


Also, there are no capital gains taxes, so my profits stay mine.


The big thing here is that banks are controlled by the government, in effect the government is pushing the public to buy gold and silver and there is absolutely zero shortage of it.  In the US, you have to rely on random stores who may or may not be able to handle the volume you are after and may or may not be willing to sell.  Plus you have to deal with absurd premiums at the whim of the seller.

Tue, 06/05/2012 - 15:45 | 2497117 Overfed
Overfed's picture

For a large enough volume to warrant delivery by armored truck, being able to buy in person at the bank is kind of a moot point. For volume like that, I'm sure Kitco would be plenty accommodating.

But I do concede that it would be very convenient to buy it at the bank.

Tue, 06/05/2012 - 10:20 | 2495757 Matt
Matt's picture

I don't think they are talking about Beijing, nor are they talking about empty homes for sale. The report is about "725.5 million mobile population": a more correct english translation (I suspect) would be "Migrant workers". The stats are for rental units for migrant workers, those people probably have homes in the poorer inland areas, but rent places in the coastal cities when working there. 3.8 million is the number of vacant rental units, which indicates that several million migrant workers have gone back to their rural villages and inland cities.

EDIT: and if we look at the numbers, they are saying about 1.4 million rental units are occupied. This indicates there is a 75% vacancy rate for rental housing. If we could find past records fo this time of year, we can determine if this indicates a massive slowdown in the Chinese economy, as it (may) indicate a severe lack of jobs in coastal cities for migrant workers.

Disclaimer: this is my interpretation from this article posted here. I did not manually translate from the original.

Tue, 06/05/2012 - 10:44 | 2495857 Matt
Matt's picture

Taken from the Google Translated page:

There are two parts to this. On one hand, when they refer to the Beijing office, I would take it the same way if someone refered to the Social Security Administration or some other national governmental office. However, some parts are specific to Beijing.

It seems they did a census of the popultion, finding 9.3 million citizens are living abroad, and 508.9 million people had their information added to the system as they were not recorded previously. 

In addition, they are 87.7% complete a Geographic Information System which allows authorities to click on any dwelling on a map, and a list of all the people residing there comes up. It seems 12.3% of residences did not reply to the survey. This was for the City of Beijing only, as far as I can tell. 

There are 1.467 million residences within the City of Beijing. The current population of the city is 20.743 million. 12.801 million people in the city are families living together, people living alone is 1.121 million, 6.726 million people are Beijing residents who sometimes live and work elsewhere, while 9.5 million people are migrant workers renting inside Beijing.

These records are also cross-referenced with the date time and type of crime commited to help law enforcement, as well as being used to plan for new schools and hospitals, etc.

Tue, 06/05/2012 - 11:14 | 2495975 Tyler Durden
Tyler Durden's picture

Maybe this will make it easier:

From Bloomberg: "Beijing Has 3.8m Vacant Housing Units, Beijing News Says"

Tue, 06/05/2012 - 11:29 | 2496022 Temporalist
Temporalist's picture

In all fairness TD, Bloomberg may be repeating what you said since ZH is the only worthy news source anymore...

Tue, 06/05/2012 - 11:30 | 2496025 Matt
Matt's picture

I think the number for ~1.4 million residences is Residential Buildings, as opposed to Commercial, Industrial, etc. That number must count an apartment building or condominium as a single "House".

 That is how 20 million residents plus 9.5 million migrant workers fit into 1.4 million buildings. 

So the 3.8 million units are in Beijing, I was wrong on that part; however, it is not 3.8 million empty houses, if there are only 1.4 million residential buildings; it counts every single housing unit. So a house that is divided into 4 "units" counts as 1 for the first number (1.4million) and 4 for the second (3.8 million). 

I was simply confused by the parts where they talk about 725.5 million people and 508 million people, which are clearly national statistics, being mixed in with city-specific stats in the same article.

It would be nice if total number of housing units was known.

If there are up to 30 million people in the city - ~20 million permanent residents and ~10 million migrant workers, occupying 1.4 million buildings minus 3.8 million housing units, we still don't know what the vacancy rate is, and without historical records, no way to compare if this is in fact as bad as it sounds.

Tue, 06/05/2012 - 10:13 | 2495761 TOWG
TOWG's picture

I read the google translation of the Chinese article and it made about as much sense as press releases from the NAR. Maybe someone who can read the original Mandarin could get more out of it than I did.

Tue, 06/05/2012 - 10:15 | 2495771 jjsilver
jjsilver's picture

in the event they evacuate japan they will have somewhere to go

Tue, 06/05/2012 - 11:06 | 2495940 Unbezahlbar
Unbezahlbar's picture


" the event they evacuate japan they will have somewhere to go..."


The people of Nanjing will welcome them with open arms:


Tue, 06/05/2012 - 10:17 | 2495773 LULZBank
LULZBank's picture

Making infrastructure and empty cities, keeping people employed, dumping USDs by stealth while sending some home to roost.


Tue, 06/05/2012 - 10:17 | 2495776 Rainman
Rainman's picture

The idiot Chinese built more houses than their peasants can afford.....just like the USSA.


Tue, 06/05/2012 - 10:23 | 2495793 Peter Pan
Peter Pan's picture

I have said it before and I will say it again. The world is not suffering from a vacancy crisis but from a homelessness crisis.

We must start to think of our problems in terms of human suffering rather than dollars and numbers. Only then will real solutions with sustinable and equitable outcomes be ahieved.

The vacancies in Beijing represent entrepreneurs gone crazy thinking that capital gains will make them rich. The Chinese have their own tulip manias like everyone else.

Tue, 06/05/2012 - 11:03 | 2495922 malikai
malikai's picture

Sorry, Peter, it's not that simple. And you're bleeding heart isn't working. Did you watch that Obama thingamagigy video too many times?

Tue, 06/05/2012 - 11:29 | 2496023 LFMayor
LFMayor's picture

how about you set up some cots in your garage for some of them then.

Tue, 06/05/2012 - 11:37 | 2496054 Dr. Acula
Dr. Acula's picture

"We must start to think of our problems in terms of human suffering rather than dollars and numbers."

We should declare a War on Unhappiness.

The goal should be to maximize overall happiness. In particular, men desperate for sex should be allowed to rape women if their pleasure outweighs the victim's suffering.


Tue, 06/05/2012 - 15:09 | 2496952 Cathartes Aura
Cathartes Aura's picture

one day you posters may have the realisation that "women" are not a "rape" toy, like so many blow-up dolls just awaiting your dangling appendages.

seriously, every ZH thread has a variant of your post, it's a rather sad state of mind to subscribe to, as history has proven.

irrespective of how some females act, not all females are powerless, some have pride, and integrity.

Tue, 06/05/2012 - 10:23 | 2495794 web bot
web bot's picture

What I am simply dumbfounded by is that China... communist China... a country with limited enforcement of rule of law, a country with a culture of bribery and corruption, a country that "manages" its data has been seen as the great white hope.

I wouldn't believe a thing I read coming out of China. I won't even eat vegetables or let my children have any toys that have been made there due to the toxins that are being found in their products.

Let's call China for what it is... a threat. Until I see clear evidence that China is embracing legitimate capitalism and rule of law, I am steering clear of China. Investing in China is like investing in a casino.

Tue, 06/05/2012 - 10:46 | 2495870 Nobody For President
Nobody For President's picture

And investing in the United States is like investing in a ......?

Tue, 06/05/2012 - 10:56 | 2495904 ultraticum
ultraticum's picture

Let's see . . . . 10 murders and 40 shootings in Chicago a few weekends ago.  In one weekend.  I live there now.  In China an 18 year old woman can generally walk down the street, alone, in any big city without being bothered - at 3am.  Admittedly that is changing a little now as the price of economic development and slowly liberalizing the police state like Taiwan did.  Lived in China for 4 years.

There are lots of problems in China - the environment is terrible, ghost cities, etc.  But you talk about bribery and corruption?  Where do you live (and invest in a morally pristine way)?  I hope it's someplace like Finland, New Zealand, or Andorra.  If it's the United Slaves of Amerika or the F. UK or most of the land of Euro-trash, sorry, but they are all more corrupt in many important ways than the Chinese.

Just look at our lying, thieving, fascist Keynesian-in-chief and all the bankster bought stooges in CONgress.  They get elected on simpleton rhetoric like "we gotta punish the Chinese".  You probably also believe that the world "hates us for our freedoms" (while you get slowly stabbed in the back with another authoritarian law passed by your corrupt overlords here in the USSA).  Oh, and let's talk about "managing the data" . . . are you kidding me? 

Tue, 06/05/2012 - 13:08 | 2496351 web bot
web bot's picture

I'm the last one to support the status quo, and I agree with you.

We are dealing with crony capitalism at the top in America... but we do have the right to mobilty, right to certain protection of bank depsoits, etc... It's the best of all of the imperfect systems- sad to say. But when this thing blows up and it will, hedge funds, CDOs and derivatives will be relics of a past era..

Tue, 06/05/2012 - 15:15 | 2496980 Cathartes Aura
Cathartes Aura's picture

I'll reply here, but am addressing your post above - with regards the Chinese "food standards" I would hope you also protect your children, family, from amrkn corporate food, particularly GMO laden garbage - as many nations have taken the steps to do - amrkn food is touted as so advanced, and it's killing the amrkn people, even as they wave their flags.  amrka has more "ingredients" that harm, yet do not allow disclosure or truth of this, hiding behind "govt. regulators" such as the "FDA" ect. - propaganda, not truth.

I know you know this, I just wanted to re-mind myself and others.

Tue, 06/05/2012 - 15:58 | 2497110 web bot
web bot's picture


Tue, 06/05/2012 - 13:20 | 2496385 crouton
crouton's picture

NZ is pretty corrupt, actually. I dont think anywhere isn't. Our current PM is an ex banker who traded against our own dollar for bankers trust during the soros asian currency crisis, who passes taxcuts for the top bracket, while increasing VAT and preaching austerity to those who already have nothing

The ruling party openly takes 'campaign contributions' from the chinese, in return for selling off our assets to them cheap. They actively fuck over credit unions and other non cartel financial institutions, we have troops in the mideast under nato command

corruption is rife amongst mid level civil servants, selling info & kickbacks, even pillars of society like school principals see it as routine.

Sorry, no utopia here. The game fishing is quite good though.

Tue, 06/05/2012 - 11:20 | 2495982 Tirpitz
Tirpitz's picture

a country with limited enforcement of rule of law,

You can't mean that an entire banking industry built upon fraud could be established there? Where robo-signing gets approved by a criminal judicial system, while the foreclosed upon neighbor who steals a loaf of bread for his hungry kids is led to the electric chair? Typical communist traits indeed.

a country with a culture of bribery and corruption,

Seems like some corporate oil CEO going vice president and a bankster monster head running the treasury there, right? Or some taxcheating globalist mega-corportation's CEO becoming the personal adviser of their Presidente to further ideas about creating jobs, while cutting a few thousands of them right on the way back from the Red House. Can happen only in such a rotten communist land. Or let them run their SEC-equivalent by some hands right from the field that should be regulated. To be witnessed only there...

a country that "manages" its data has been seen as the great white hope.

Yeah, they might need to massage the annual inflation numbers to manageable levels, and, to balance this welcome adjustment, they'll just make up for a few megatons of fantastic weapons of mass destruction in some remote country rich in oil and far off the major maps. At least the fancy killing toys were sold to them a mere decade or two back by a highly trusted broker, so they should show up somewhere, sometimes.

Great to see we are so much better off. Where a small group of politbureau commissars never will see the slightest chance to loot the country, as the international banksters just won't let them onto their turf.

Tue, 06/05/2012 - 11:53 | 2496107 Dr. Acula
Dr. Acula's picture

>I won't even eat vegetables or let my children have any toys that have been made there due to the toxins that are being found in their products

Dead Babies' Flesh Found Smuggled In Drug Capsules

"The capsules were made in northeastern China from babies whose bodies were chopped into small pieces and dried on stoves before being turned into powder"


Tue, 06/05/2012 - 10:26 | 2495801 FieldingMellish
FieldingMellish's picture

Comparing burgers to dim-sum. I don't believe ANY number that comes out of China. Then again, I don't believe just about any number that comes out of any government.

Tue, 06/05/2012 - 10:32 | 2495823 AGuy
AGuy's picture

FYI: The US has about 18 million vacant homes. There are a lot of homes that aren't listed.

FWIW: I see lots of homes that are vacant on my daily commute. Most became un-occupied between 2008 and 2010. Originally there were For-sale signs while they were occupied, but after they left, the for-sale signs disappeared, and the weeds starting growing. I even see one with a small tree growing in the middle of the gravel driveway. I suspect these home are GSE owned and therefore ignored. It would surprise me that the GSE have used a servicer (bank) that is suppose to list them, but the servicer is fraudent informing the GSE that these homes are listed and being properly maintained, which they are not.



Tue, 06/05/2012 - 10:33 | 2495827 Unbezahlbar
Unbezahlbar's picture


Hong Kong Homes Face 25% Drop in Year of the Dragon


Another example of EZ Credit and where median house prices are seriously overvalued relative to median salaries from what I have read. I have not been to HK but read the pollution is pretty bad too...maybe Banzai could comment?

Tue, 06/05/2012 - 10:46 | 2495866 ronaldawg
ronaldawg's picture

Hong Kong is awesome - problem is too many people in a small area.  Since HK is on the sea - the pollution is not noticable (unlike the interior of China).  Also they have the most awesome airport in the world.

Tue, 06/05/2012 - 10:50 | 2495882 Apostate2
Apostate2's picture

That article is old and housing prices have not dropped yet. The government has taken some measures to reign in price hikes due to speculators and mainland buyers (about 33%). Housing is still not affordable for the majority of the population since the dip in '97 due to SARS. It's flat-high-lining now and the uncles have less money to launder. Pollution has diminished somewhat due to the slow down in production across the border (the local rule of thumb about the state of the mainland economy) due to the prevailing winds and location of factories. A 25% drop is wishful thinking until it isn't. This is a rent-seeking society.

Tue, 06/05/2012 - 12:28 | 2496220 JohnKozac
JohnKozac's picture

When my HK friends visit LA they exclaim,"the air is so clean here."

I am stunned! as far as the house prices...or should we say apartment prices....when the 'hot money' from the Mainland stops flowing into HK, who knows how far the RE will drop.

Tue, 06/05/2012 - 10:47 | 2495872 EmileLargo
EmileLargo's picture

Based on this, no one should ever be homeless in China - ever.

Tue, 06/05/2012 - 10:49 | 2495876 CloseToTheEdge
CloseToTheEdge's picture

maybe a few of their proverbs will see 'adjustments'


“A bride received into the home is like a horse that you have just bought; you break her in by constantly mounting her and continually beating her.”


Tue, 06/05/2012 - 10:49 | 2495877 kekekekekekeke
kekekekekekeke's picture

I heard they're moving the refugees from Fukushima to the "ghost cities" and vacant housing confirm/deny

Tue, 06/05/2012 - 10:49 | 2495878 ghostzapper
ghostzapper's picture

But, but, but all those tough guys on Fast Money said China would grow at 10-15% every year into perpetuity and you should stay long oil and copper because Chinese demand will forever lift commodity prices.  but, but . . .

Tue, 06/05/2012 - 10:54 | 2495892 Kina
Kina's picture

Yes the Chinese and other Asia languages have the habit of using large numbers in conjuction with a 10,000 mulitplier rather than the 1,000 we use in the west.

Tue, 06/05/2012 - 10:55 | 2495898 Bartanist
Bartanist's picture

Lol .. yes, but they are "investment" properties. Haven't you heard? Why store your money in anything other than something that can never have utility ?

Tue, 06/05/2012 - 10:56 | 2495901 judejin
judejin's picture

the beijing number is definitely not right.

china's biggest problem is most of the rich people, regardless how they got rich, usually want to move abroad. because of this, the luxury real estate price level is not as high as that of HK, NYC or Tokyo. but most of the luxury apartments are sold but vacant, while luxury neighborhood in LA, australia are full of chinese in sports cars.

it's a different bubble.

Tue, 06/05/2012 - 11:05 | 2495933 Downtoolong
Downtoolong's picture

Beijing Alone Has 50% More Vacant Housing Than The US

I’ll move there and buy one if they will offer me a job that pays $25 per hour, in gold.


Tue, 06/05/2012 - 11:06 | 2495941 reader2010
reader2010's picture

The new proposed Party Order #2012-#7-#1 is that every Party member has to get at least ten mistresses. Problem solved soon. 

Tue, 06/05/2012 - 11:13 | 2495972 Ranger4564
Ranger4564's picture

They built that housing for the Japanese evacuees and the foreign emigrees.  Didn't you apply for your visa yet?

Tue, 06/05/2012 - 23:05 | 2498270 Tompooz
Tompooz's picture

  "Didn't you apply for your visa yet?"

Handwritten application forms are no longer accepted by some consulates.

You must fill out the on-line application form and print it out.

Experience China for yourself, if only to see the difference between a generally optimistic police state and a generally pessimistic one.


Tue, 06/05/2012 - 11:34 | 2496043 CitizenPete
CitizenPete's picture


Not trying to say there is not a housing glut in Beijing, but you need to put things into perspective:

Beijing has about 23 million people and is about 6500 square miles.    Compared to a city like New York City with 8 million people and 470 square miles. 

Beijing, being similar to Washington D.C. as a capital city, is home to many transiant people in various businesses and government roles. when I grew up and  lived in the D.C. area (N. VA and MD) I came to realize that the local population was not too much larger than the population of transiants.

Just keeping it real.


Tue, 06/05/2012 - 11:40 | 2496066 Weyland_Yutani
Weyland_Yutani's picture

There is no bubble here. Move along.

Tue, 06/05/2012 - 12:31 | 2496235 JohnKozac
JohnKozac's picture

You sound like Greenspan, 2005..."there's no bubble in housing...."

Tue, 06/05/2012 - 11:49 | 2496100 vegas
vegas's picture

This is especially great news for our bud Simon, as it means we can get great, cheap housing in the freedom of China. Only, I can't get out of my committment to Jenna Bush for the 3 acres I'm sharecropping from her in Paraguay. Sorry Simon, I can't move for another 55 years.

Tue, 06/05/2012 - 12:09 | 2496157 S-hai High
S-hai High's picture

The article is a little confusing since it talks of a commuter population of over 700m - this is clearly not specific to beijing; also over 500m newly registered people - again, not beijing specific. The 3.8m empty apartments does seem far too high, especially given a population of 20m. However, given that there are few other avenues to invest money, its not unreasonable to think that 20% of the city's population have bought a second home, and keep it empty, to try to store value.

Whether you believe this to be sensible or not, you simply cannot compare to the US - its Apples Vs Oranges. Most Chinese outright own these investments. There is no mortgage to default on; or those with mortgages must put down 60% collateral for a second home. The big difference being therefore, that there is not nearly the same pressure of forced selling in a downturn. And since there are few other avenues to invest, they are quite happy to sit on the investment (often it'll simply become the home of their son/daughter or grandchildren)

The danger of the situation however is the potential of a property tax (which has been spoken about for a few years) - this would catch out a lot of investors, but since many gov officials probably own several properties.... i can't see this levy being passed as a bill

Tue, 06/05/2012 - 13:01 | 2496332 Zero-risk bias
Zero-risk bias's picture

Yep, due to the new 100 day initiative of wiping out illegal workers / foreign trash / rebel scum)

725.5 million migrant/ 'non hukou' (temporary residents nationwide).

508.9 million newly registered over this period, as the initiative is not limited to Beijing in scope.

The rest of the data is Beijing specific.

In excess of 1903 cases of crimes have been reduced, including arrests and detentions. Beijings' community crime incidence fell by 9.9%, burglary cases fell by 9.6%, car theft 15.7%. I guess quite a lot of visa overstayers, non-registered and illegally working people have been sussed out or fled.

I had someone knock on my door in Shanghai asking where I was from. They only wanted to know which country, they ticked a box, then they disappeared. Very efficient.

I estimate here in the burbs, I'd say nearly all new developments have 2 vacant apartments to every 1 occupied. And building continues, albeit a bit slower pace than over the last five years.

Tue, 06/05/2012 - 12:29 | 2496230 animalfarm1984
animalfarm1984's picture

Over 90% of the vacant dwellings are condos but still they outdid us.

Tue, 06/05/2012 - 12:32 | 2496239 besnook
besnook's picture

the difference between china and the usa is a hard landing in china means a fall to 5% growth on a 5 trillion dollar economy and a crash in the usa is a 5% real contraction in a 14 trillion dollar economy most of which is selling microwaved burritos and 32 oz. sodas to a population that produces mostly methane.

china is building for the future while the usa is clinging to past glory(pacific naval dominance was the original source of japan conflict pre ww2).

hopefully my two kids will buy or rent a coupla those aprtments in a few years earning and spending the new good as gold currency.

Tue, 06/05/2012 - 12:50 | 2496298 erheault
erheault's picture

  When China created the Three gorges dam they flooded millions of acres and small farms they promised the farmers that they would relocate started to build concrete rabbbit warrens near major cities for them, Also at that time the factories was booming making trinkets for the world so the housing construction boomed

it turned out that the farmers being mostly illiterate was not happy in the warrens and were mostly unemployable so moved into the slum areas or went out in the country trying to reestablish farms again,, Meanwhile in the cities the world started to slow down on the products China was exporting causing factories to slow down or close thereby releasing workers to return home or just disseapear as they seen fit hence the large amount of empty housing and the slowing down of their economy.

Tue, 06/05/2012 - 23:41 | 2498326 hangman
hangman's picture

Yet, in the end, no matter how we slice it, unlike rest of the world, China has no debt.  Instead, they have lots of cash that the rest of the world is drooling over.  More importantly, they have no two party system that is "deadlocked," and all they care about is winning in November, no matter the costs to the country and its people, etc.

In one sense, if supply and demand really works, isn't it better to have more empty houses than not for working poor?  I wonder what are ownership percentages for U.S. and China?  I've been hearing lately that the super-rich in U.S. are buying tangible assets... Like houses... That were taken away from working and unemployed, etc.  Thus, wealth is being transferred even more from the rest to the 1%!!!

In short, I am really worried about U.S. for the first time, ever!  I don't worry about China.  Who cares how many empty houses or factories they have, etc.  We should worry about our empty houses, homeless, often veterans, and empty factories, etc.  I often wonder our interpretation of free-world.  Is it more free to be begging for jobs or snarled into minimum wages?  Even defending our nation has to be contracted out to the poor?  Where is this nation heading?






Tue, 06/05/2012 - 13:15 | 2496373 Hamsterfist
Hamsterfist's picture

This is apples to oranges and aren't the U.S. numbers most likely a lie?  (Not that China's aren't a lie too.)

Tue, 06/05/2012 - 14:57 | 2496893 Bunga Bunga
Bunga Bunga's picture

Simple solution: Chinese buy up empty American homes as investments, Americans buy up empty Chinese homes as investments, problem solved, win-win.

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