Categorized | International

Analysts Believe China’s Real Estate Market is Simply Cooling

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Over the last few months, many economists and analysts have claimed that China’s real estate market is in the midst of a major crash that would likely do damage in other areas of the nation’s economy. While the housing market is certainly weakened, as can be seen in the five straight months of price declines, various analysts are stepping forward and speaking out against the idea that the market is crashing.

 

The declines experienced in the Chinese housing market have been gradual across the nation, as opposed to a sudden massive crash that would be experienced if a housing bubble were to have burst. The gradual declines in pricing have come as a result of the government’s imposed property restrictions, which have made some ineligible to buy properties, and others unable to secure the necessary financing to make a purchase.

 

There have been many doomsday predictions regarding China’s housing market in the past six months. Some have said that the overall residential real estate market in China may fall by as much as thirty percent during the year. While prices will certainly continue their descent, analysts now believe that such a massive decline will not take place. Rather than labeling the declines in pricing as a real estate crash, these analysts believe that the price drops are simply the result of the market correcting itself.

 

One of the big reasons why some analysts are not calling the current situation in China a housing crash is that there is no sign of a foreclosure crisis. Even as prices continue to gradually decline, it is highly unlikely that the nation will see a spike in the number of foreclosures.

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About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

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