Monday, September 25, 2023

China's 1.4 billion population isn't enough to fill the country's empty homes, former official says 

  • A former Chinese official said the country's entire population couldn't fill its empty homes.
  • He Keng said China's 1.4 billion population was likely insufficient to fill all its vacant houses.
  • China has long been plagued by a real-estate crisis, with many empty properties and ghost cities.

A former Chinese government official said the country's entire population of 1.4 billion wouldn't be enough to fill all of its empty houses , Reuters reported, citing a video from the state news agency China News Service.

China's real-estate struggles rose to prominence in 2021, when industry giant Evergrande became the most indebted company in the world and defaulted.

At the time, there were at least 65 million vacant properties in the country, which would have been enough to house the entire population of France, Insider previously reported.

"How many vacant homes are there now? Each expert gives a very different number, with the most extreme believing the current number of vacant homes are enough for 3 billion people," He Keng, a former deputy head of the statistics bureau, said, per Reuters. "That estimate might be a bit much, but 1.4 billion people probably can't fill them."

China has long relied on real-estate development as a safe investment to bolster economic growth. But that's created an excess supply, with endless rows of high-rise buildings left empty.

"They built an oversupply, and then they sold it. And that's why you see the vacancies," Li Gan, an economics professor at Texas A&M University, told Insider in 2021 .

Many buildings sites have also become so-called " rotten-tai l" projects after they stalled or were abandoned halfway through.

City's like Shenyang, in the country's northeast, were envisaged as new hot spots for China's ultra-rich, with flashy European-style villas.

But the development project headed by property giant Greenland Group, which began in 2010, was abandoned just two years later.

Today, farmers have taken over the ghost town, plowing the land and letting cattle roam free around the empty mansions.
Cattle wandering between half-built villas in Shenyang.

Ordos, near the border with Mongolia, was meant to hold over 1 million people and become a cultural and economic hub. But by 2016, its population was only around 100,000, and it has been described as "the largest ghost town in the world."

The government has since enacted efforts to move some of the country's top schools to the region, which has led to an influx of families and high-achieving students, bringing the population and real-estate prices up, Japanese publication Nikkei Asia reported in 2021 .

Despite these efforts, Inner Mongolia, the autonomous region of China where Ordos is located, is still one of the slowest-growing areas of the country, per the report.

"We can't shake the fear that if new development picks up steam, we'll create a new ghost town," an Ordos real estate developer said, per Nikkei Asia.

Read the original article on Business Insid


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