Government data has shown that home prices within seventy major cities in China such as Beijing and Shanghai have fallen about .4%. This has marked the ninth consecutive decline partly because of a slow economy and oversupply problems. Since homes are not worth much, there is now more business within stock markets for better investments. Although there had been a surprise cut interest rate in China's central bank, the prices continue to fall. It is interesting to see China struggling with this issue because China has been known to have a growing economy do to their production rates but yet still have to deal with these issues. Housing finances is a large part of an economy. It is one of the main reasons why the US dealt with our recent recession. If China can somehow improve this falling rate and have homes become an investment, their economy can grow much more. It is hard to say if this change will happen any time soon but so far it has continued to decline. Although it is hard to say if it will change any time soon, there is acknowledgment of the issue and there's hope that the government will be able to make adjustments such as having banks hold less reserved money which can boost lending in order to help property sector. Whether it may help or not, no one is sure but at least there is acton being done to take care of the issue.
http://www.bbc.com/news/business-31498557
No comments:
Post a Comment