Shanghai Property Market Tumbles
In one major Chinese city, the home price boom has quickly ended. "Shanghai's new middle classes, every bit as obsessed by rocketing property prices as their British counterparts, are suddenly asking if the bubble has finally burst. After years in which prices rocketed out of all proportion to Shanghaiers' still lowly incomes, the last month has seen the first falls being reported by local media."
"Sales in April dropped from 30,000 to 10,000. Prices for some new developments have dropped by a fifth almost overnight, while officials say the fall is already averaging over five per cent."
Doubters of a global bubble should read this. "Speculative investors have plunged into the market from elsewhere in China, Hong Kong, and further afield. There have even been private investors from Britain and Ireland willing to take a gamble. Prices rose by 19 per cent in the first three months of this year alone."
"'I think the overall correction will be in the region of 10 to 20 per cent,' said Sam Crispin, a British property consultant in Shanghai."