I've actually visited these ghost cities and have come to understand exactly what secret is hidden in these bizarre concrete labyrinths, thank you so much for supporting what I do by watching my videos, you're all incredibly awesome!! Support Sasha and I on Patreon: www.patreon.com/serpentza Bitcoin - bc1qxfjp2t6x5dpslv59u0jl89m6k643hcn8h2jsvp Ethereum - 0x6Da150a2A8529110017Ed4db68B3dF0084900280 Paypal: paypal.me/winstonsterzel
Having high GDP, makes China look more legitimate as an economy. It also attracts more foreign investment into China. However, China's able to fool everybody because they calculate their GDP differently from every other country. I'd share a video link from a respected Economics Professor, Michael Pettis, but I'm confident this comment won't post. Essentially, The world calculates their GDP from investments that actually contribute to the economy. If the investments do not contribute to the economy, then their impact on GDP is reduced. Not the case with China. China does not reduce their GDP if there's no economic impact from investments. Therefore, as long as you keep building and constructing, regardless of their contribution to the real economy, their GDP stays artificially higher.
if you find Kyle Bass and Michael Pettis and go to 32:33 you'll find where Michael Pettis explains this in detail. You'll see the smile from Kyle Bass's face, when he hears this, because he knows how BS it is.
Apart from being an absolute tragedy in progress financially/economically, I'm devastated at the thought of how much damage this has done to the environment, and how much raw materials which, today are in short supply, have been wasted.
Also bare in mind, most of the land these cities are built on was arable farming land. Farmers who had farmed here for generations where kicked off the land to build these cities. Another food supply gone with each city. Didn't learn much from the sparrow debacle did they?
The planet literally renews itself. The vegetation will overshadow all that was built long before humanity kicks the bucket. Give nature enough time and it will find a way. It always did, always does and always will
@@windsorSJ I’ll be honest, I didn’t think of that. Knowing the CCP I truly doubt that the farmers they kicked off that arable land were paid for the destruction and loss of their homes or indeed received any compensation worth all they lost. By compensation I mean other things than money such as a new, comfortable, adequate place to live and new jobs to replace what they got being farmers. But if I understand China correctly then nobody actually owns the land they live on, they just lease it from the CCP for like 90 years or something like that. I think I read somewhere that there is a degree of class separation in China with rural people being the lower class, with their passport or other forms of ID bearing a symbol or colour marking them as rural even if they move into cities. And so being denied a lot of things such as going to university. But take that with a pinch of salt because I don’t remember where I learnt it.
I'm a mortgage broker. However this finally ends.... it can only lead to a depression in China worse than has ever been seen in human history. It is impossible for me to accurately relay how bad it is. The 2008 US housing crisis is absolutely nothing compared to this. It is a fatal error made by the Chinese system - it will kill their government. Literally.
Ironically, ending the CCP would be the best thing that ever happened to China. The CCP CAUSED this housing debacle by restricting productive investment and capital markets. Communism is the worst system of goverment ever created, it has failed everywhere it has ever been tried. Compare mainland China to Hong Kong or Taiwan which are sort of like China without communism and you can clearly see which system is successful and which is holding a country back.
@@gordo3582 But it would be the worst thing for the rest of the world. Since we wouldn't be able to produce iPhones for less than 300 bucks to sell them 4 times a higher price
My Chinese wife wanted to buy a second apartment, but I rejected her: Not only are the prices unaffordable, but also the value of a property is always subject to supply and demand. If almost every family in China as two or more houses on average, who would buy your apartment if you were to sell it later? If there's any point in time where many people want to sell their apartments, the prices will drop significantly, and you could only sell an apartment at a loss. It's a bubble, nothing else. And the worst thing is that building all these houses is a giant waste of resources and pollutes the environment for no valid reason. It's terrible.
Winston who's no Churchill has a Chinese divorcee as a wife. In China divorcees are shunned and stigmatised that's why she married Winston. She's second-hand goods.
Never been to china, don’t plan to, but recently I went to a city that was dominated by the Chinese in Cambodia called Sihanouk ville. It was SHOCKING the amount of empty buildings, empty hotels, restaurants, casinos etc. The local Cambodians left because Chinese investors bought all the land and started pushing local businesses out, this causes tourism to die out as people want to go to Cambodia for Cambodian culture, not Chinese (all the stores, casinos etc were all Chinese dominated). It’s honestly so sad to see.
They've been doing that to a lot of countries. When the pro-China former Philippine president shuttered Boracay island (a major tourist destination) for cleanup, dozens of Chinese restaurants sprung up after the island reopened. And what's even more insulting is that their menu are all written in Chinese only! I'm glad that has come to past and most of these restaurants closed down. The current president is thankfully pro-Philippines.
This is what capitalism has brought to the world, uneven distribution of wealth and overproduction. On the bright side, the climate in the area where these houses are located is actually good. It can meet the housing needs of hundreds of millions of people.
@@timbercladdingcn - and yet the even distribution of wealth communists tried on some of the largest land masses in the world with some of the largest population densities ever decided after failing miserably to go for the ‘unfair distribution of wealth and property aka capitalism. So much for the woke snowflake ideologies, hmmm? 🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣
@@timbercladdingcn Bruh this is the dumbest take. It's literally Communist China you are talking about. None of this involves creating competitive products that actually have demand, it's all artificial fakery that is the masterclass of communism.
In Nova Scotia there was a property tax loophole that assessed homes still under construction for just the land it was on. This resulted in people nor quite finishing construction by not building the front door steps. Driving around rural areas you would see many homes without doorsteps
@@mrtoasteer3561 ...most of Eastern Europe was like this as well...you would see homes fully occupied with no finish coat because it's considered incomplete and taxed at a different rate...
It's pretty sad. Here in NZ, our home has practically tripled in value in ten years, as successive governments have utterly failed to keep land and building prices reasonable. Young people are pretty much locked out of the market today. It is a national tragedy.
I was looking at a chart the other day of house price increase for each country over the past 40 years, and we had the highest with a 500% increase. For comparison, next was Spain with a 350% increase.
I'm a mortgage broker. The fact the mortgage payment is $4,400 while the potential rent is only $705..... I mean, that's absolutely shocking. That is unbelievably bad. I've done mortgages for just about any type of property in Florida and that is so much worse than anything I've ever seen that there are no words. That is an issue so severe, if it were going on in the US, my only reasonable prediction would be another Great Depression. It is impossible to accurately relay how horrendously bad that is. That's 100× worse than any market in Florida - I am being completely literal with that. Their housing market is a ticking nuclear bomb
... the bigger bomb is debt bomb, if your city and local factory took out debt from rich 1% to subsidize sales of laptops to undercut japan by 20%, and eventualkg both are at 200% debt to sales so at 10% interest have to pay 20% of sales revenue as interst, , , ,. So suddenly undercutting becomes overpriced by 20%, running out of debt ruins so many businesses till then they magically sell lots cause it's not full price.... Can China recycle all that concrete, why the F did govt do this, is used concrete valuable? Nah.
@Gretchen K. of course thee sis homelessness it’s just the numbers compared to China when it comes to homelessness is very low only less than 500,000 people late homeless most live in Cars Trailors and Homeless shelters in China there are Millions kg homeless people who don’t have a house they own
Fr, I was in China during the massive dam project that was set to flood generations upon generations of farmland and villages. I took a boat ride down the river during the dam construction, and you would see markers in the middle of towns indicating how high the flood waters would rise. The markers were up one or more stories on buildings. People had to see that visual reminder every day years before the project was fully completed (it was done in stages, but still). I heard and saw so much propaganda about this project along the way, and it made me sick. People I spoke to in the small towns and villages varied between optimism, even though they had only ever farmed because they believed the government would house them in fancy accommodations and train them in shiny new jobs (but this was likely factory work), and straight up contempt for a government they knew was pulling the rug out from under them. So, I’m not one bit surprised.
@@kritischparken - Culture or not, when you eat dogs and hard boiled eggs soaked in boys urine (REAL THINGS), plus the influx of fake food - I would say the problem goes beyond hunger.
A friend of mine is a landscape architect and he spent a lot of time working in China back 15 to 20 years ago. He told me this same story way back then. They continued to build cities when others remained unfinished and/or empty. He said it made no sense then either.
What we see in Australia is the Chinese will pay absolute top dollar for apartments. This just sets up a unrealistic real estate bubble price while the Chinese pump the market paying too much. When they stop pumping the market thats when the bubble starts to pop. That's the point were at in Australia now.
Same in New Zealand. The large influx of a Chinese buyers that started in the 90’s and continued until recently, has inflated the market to ridiculous levels.
We took the high speed train from Beijing to Xian a couple of years ago, a 1200 km trip, took about 6 hours. I was amazed at how many of these huge apartment blocks we passed along the way.
@@yikyak4249 by definition it is a net negative. You cannot take multiple fiscally negative measures and say the net benefit is good. It's like wasting money on war and saying it helps the war industry grow when that is resources stolen from the rest of the economy
@@bloodmuffin123 Actual billions. China's whole system is a Ponzi economy like Winston stated on debt. That includes high-speed trains, skyscrapers, bridges, luxury apartments, mega airports, and airlines. Every project that is listed is losing money.
For your viewers who want to understand why these ghost cities keep being built, the person to read or listen to is Michael Pettis, professor of finance at Peking University’s Guanghua School of Management. One of his insights: whereas in most countries GDP is a measure of activity taking place in the private sector, in China GDP is a TARGET that the CCP sets every year. The provincial governments then have to meet that target. If organic growth coming from the private sector won't meet the target, the provinces then build these Potemkin villages financed by state bank loans. But China has enough infrastructure now, so the R.O.I. on these newer projects are often negative, but still count towards GDP. The ideal solution would be for China to shift from being an investment led to a consumption-led economy like the U.S. but this is unlikely to happen for 2 reasons. One: this would require shifting capital towards households and away from the state. Translation: fewer opportunities for kickbacks and corruption for politicians/bureaucrats, and more power for entrepreneurs. Two: China is now the fastest aging society in history, with a population expected to cut in half by 2100. Most consumption takes place in the 25-49 age cohort, which will shrink drastically going forward. Another interesting piece of info: in the US, if you invest in, say, a factory, but the factory goes bust, the loss is written down and subtracted from gdp statistics. In China, if said factory goes bust, the loss is not subtracted from GDP. This is often because bad loans are often rolled over into new loans rather than entered as a loss on the books. God only knows how much said accounting tricks factor in to China's GDP stats.
Real problem is caused by the usual "refusal to lose face". Entire county is lying to themselves. Contrived government sets GDP "goals" that cannot be met. Managers intentionally lie stating they have met that goal. In this artificial environment new goals (at higher rates or returns are then set) which are then also not met and then lied about. China is the result of a failed philosophy. The mountain thieves have stolen the entire civilization. They will keep on pushing the "big lie" and everyone buys into that lie. Soon to be a ghost civilization.
In 2016 I was in China. Between the city of Kaifeng and Zhengzhou, there were very large, completed apartment buildings that were sitting completely empty and they are surrounded by more construction projects to feels more apartment units. The country just got completely addicted to building and speculating in real estate. In the future, this speculative bubble will probably be something as ridiculously large as the Dutch tulip bubble of 1624.
I have spent my working life trying to reduce material wastage in my landscaping company, I am so careful to recycle everything. If I dismantle a wall I clean the bricks and reuse them. If I leave half a bag of cement to go hard I feel guilty. Seeing this is heart breaking. No wonder we are running short of resources if this is how they are being used. There is not an infinite amount of building sand available.
And soon this will be happening in the USA too, don't forget that the Democrats want the USA to become socialist (communists), what is happening in China happens because the socialist government meddles in people's lives and every generation of American children more and more they think that socialism is good...
@@ThetOLogrin This is incorrect. Joe Biden is more right wing than Boris Johnson. He would be too right wing to be elected in Britain, same with Obama. We are a conservative country. The U.S Democrats do not support universal healthcare or state funded tertiary education. They are not Socialists in any way, even Bernie Sanders is a Social Democrat. They are Liberal Capitalists, the same as the Republicans. Communism is Fascism, they are the same thing. The Chinese government is not Socialist, it is Fascist. They have no intention of handing power to working people ever. Just because they are called 'Communist' means nothing. North Korea is called Democratic. Words are cheap.
@@deiselden Wrong kind of sand unfortunately, good concrete requires hard, jagged sand particles that retain strength. Biological organisms cook down to a mineral rich powder that is good for fertiliser but makes weak building material. Adding fresh blood to concrete during mixing does make it much stronger but we need that when we are alive.
I visited a ghost city that was about an hour's drive north of Fuzhou in Fujian. The developers had built an entire water/amusement park to help market the city as a holiday destination. I revisited the same place about 5 years later and the apartment towers were still completely empty. A very small number of the villas were occupied, less than a dozen, the Waterpark was still closed and looked as if there has been no further construction on it since my previous visit. In fact, the only business I saw open was a single convenience store and the sales office. It was bewildering.
@@stehenry5634 I believe it was called Jinzhou. Almost directly north of Fuzhou. It was about 8 years ago last time I was at that town. No idea the state of it now.
I took an Uber ride the other day and my driver was from China. He was explaining to me how bad the government is and he could never go back and live there. I remembered all these videos I watched and just hearing it come out from a Chinese person made all this information even more eerie.
@ J D : If you ever _do_ meet someone who _does_ like the Chinese government and _would_ like to live there, you can give that person this good news : They _don't need_ to go all the way to China (about a 10,000 km, 14 hour flight from the U.S.) to experience the cavernous stupidity, iron-fisted authoritarianism and gross incompetence of the CCP government. All they have to do is *_vote Republican!_* See what I mean ? No need to suffer the cost and inconvenience of moving to China. They can get it right here in America once the donald trump Republican agenda has converted American government into a one-party dictatorship that merely has to _declare_ that they've _"won"_ every election.
@@frv6610 Some look happy because they're oblivious to what is really happening. They are easily entertained by flashy things. We have a class of populace like those here in the US.
@@frv6610 ... they have facial recognition camera. If you have unfavorable opinions...points deducted and you get penalized... can't travel freely...etc.
@@brysoncherry9884 And this video of China ghost towns shows what happens when you have the "freedom" to do whatever you want with your land, even if it's nothing at all.
After the fall of the Soviet Union, economists said that it wasn't so much that the Soviet Union was underdeveloped, as mis-developed. Capital invested in the wrong things. Von Mises said the problem with communism is that it cannot determine economic value. Market systems work by constantly assessing value through mass market transactions.
Perhaps that's why modern China is not communist. It's officially a mixed free market and socialist system under the oversight of CPC. Also known as socialism with Chinese characteristics.
@@brexitgreens Only in terms of international trade, however; as China is forced to do so, if it wants to do business with other countries. Most Nations use a blended economic model. But China is still communist in the sense that they've elevated an outdated and failed western economic philosophy to the point of ideology.
@@brexitgreens Brexit: The CCP overrules market incentives and distorts market functioning. Only a fool would put money into Chinese investments. You will lose.
...and those mass market transactions are more or less free from state control and direction. When you overlay an ignorant, dogmatic, thuggish "socialism with Chinese characteristics" system on a market economy and market systems, that governmental heavy hand distorts and can destroy those markets and the people working within them. Modern China fears the "free hand" of the market because it saw itself losing power and control over its own people. Rather than partnering with the markets, it's now squashing those "enemy" markets to preserve those so-called "Chinese characteristics." For example, who cares if citizens can no longer get food, medication, health services for, say, cancer or kidneys or the heart, or if citizens commit suicide from being locked in, or if buildings burn down because firefighters can no longer do their work? That's fine. Another example: food. How is food getting to the people? How are farmers planting their crops when they are not allowed to get to their fields or harvest the food? Just so long as the authorities can log deaths in any column other than "COVID-19", it's a "win" for the state and a way to boast that "Chinese democracy" is the best "democracy" in the world. Question: Do Chinese citizens vote for local or national officials? Are there competing candidates who discuss the issues to try to persuade the people? Those are elements in a democracy, after all. It's the reapplication of the communist system that's strangling the country and now killing its people. But, of course China can declare that evil "foreign forces" (aka, the USA and its imperialist running dogs) are at work to undermine GREAT CHINA! Solution: War!
Concrete requires a specific type of sand to make that is also running out. All that concrete wasted, plus the energy used in all the harvesting, transporting, and construction. All for what? It's all just so goddamn wasteful.
@@oveidasinclair982 no offense but if you think this is communism you literally don't understand what communism is. This is like,,, even beyond post-capitalism. This is focusing on making money so much that nothing makes sense at all. Where everyone is trying to make enough money to pay their rent and also owns a cheap investment house hours away from any city...?
I like how it's only 13 minutes long but its content is a hundred times more clearer than any hour long videos out there.. Great work, I just found your channel and subbed immediately..
How can a property which is neglected in the middle of a ghost town - and therefore be subject to no maintenance or general upkeep - maintain or increase its value? As you highlighted in the video, these buildings are deteriorating rapidly to the point they're clearly not safe to be around, let alone live in. Any value that these properties may be worth will be lost in renovating the towns all over again due to dilapidation. Total false economy.
You don't lose money until you sell at a loss. You can still take out a loan against your inflated property value. The bubble will of course burst, but not the way it would in a free market.
This is hands down the best video on the Chinese real estate problems on youtube. For starters, it contains original footage and the two individuals had the balls to travel all over China to get this footage.
A sad future lies aheah, faking video material like that gets easier and easier which will only make it easier for countries like China to rub all accusations off with "it's fake news!"
Damn I never realized how unbelievably speculative this was in China. Bubbles can be sustained for a given time, but eventually an investment has to be supported by it’s intrinsic worth. People paying hand over fist for empty concrete husks with nobody to live in them should send all the alarm bells ringing. It’s insane.
" eventually an investment has to be supported by it’s intrinsic worth." --- There is hardly a truism more true than this one. Why doesn't it happen? Easy answer.....government.
It's not even speculative at that point, I think. It's more fictional, like a Bitcoin or non-fungible token, just with a more stable market value. With the low/non-existent population growth, there is clearly no realistic chance those apartments will ever be used.
Great rundown. I learned a lot, and I've been following this peripherally for a while. I also appreciate your obvious sympathy for the average Chinese person. I've spent some time there- really wonderful people and culture that are caught in a very difficult situation. You made a complicated situation and country more understandable.
I used to love exploring these cities. Something about them that was so intriguing. At one point, I wanted to move to Ordos just to start a whole series about it. Kinda glad I didn't tbh, haha
When I was in the Navy, my ship, the Lassen, sailed up the Yangtze to shanghai. I was lucky enough to be on a guided tour of Beijing(after customs questioned how 20 US military members got into the country without showing passports). The entire trip I was noticing MASSIVE construction projects. It became clear the nearby buildings were empty and yet they were still building more. That was 2008. The US was having a housing bubble issue, but China looked like their entire economy was based on a bubble vastly greater. God forbid that bubble burst because if it does, the dominos will ALL start falling.
My Dad sailed out of Pusan harbor, under fire, in 1950. His was the first American flagged ship to sail inland since commie takeover. Last until Nixons crew opened trade. They were ordered to Beijing. Merchant Marine with Navy V12 training. Chees Mate
Domino will not start falling. We might see price drop of real estate in the western world but not total collapse China is facing. Simply because real estate there has value with purpose to generate income or some form of value. In China the only purpose of most of real estate is to be built to drive construction GDP up and to be sold to drive real estate sector GDP up. Regardless of whether someone lives there, rents there or if it still stays 10 years later. This is simply not how it works in western world which is why real estate here will keep atleast 80% of its current value. In China it could be easily like 5% with their income to price ratio and the fact that most of those buildings are already falling apart and will soon not exist.
Very well explained! They have purchase property in Vancouver, Canada - there are huge houses sitting empty, destroyed by vandals, and have had a major impact for many years on housing prices here.
Do you mean Chinese have purchased property in Canada? Because if so, they are you doing it here in New Zealand too and it is driving our housing market up to a point where us NZers can't afford to buy houses! Our people kicked up a stink and the government put small restrictions on their purchases but don't stop it because all governments are selfish
@@Mr_C.Bacteria Yes - I am talking specifically about Vancouver, British Columbia. Until I watched this video I did not understand why they would buy multi-million $ properties and leave them vacant and rotting; not caring what happens to them. We have a vacant house tax here now but it doesn't seem to make any difference.
People with such a warped way of doing things should not have been let in in the first place. Governments can try to fix the problems AFTER letting immigrants easily in but it's like waiting to defend your castle until AFTER the invading army has breached the walls.
@@dwight4626 The problem is not those immigrating - it is investors that have no intension of coming to live here. I wish there were laws in place to protect the market from foreign investors.
A few years ago my daughter and I rode our scooters away from Guangzhou to see what we would see, after about 20 minutes we drove into a small town that was completely empty and deserted. It wasn’t big like what you are showing, but it was empty and obviously had been for a while. Like an old west ghost town. There were a couple people walking around, but 99% of the place was deserted. My daughter (21) said she was scared and we should turn around, We did and did not stray far from tourist areas after that.
@@kentclark6420 Not even useful for the homeless. How would you provide them the services they need? No markets, no food, no hot water, electricity, is basically like living on a cave apart from civilisation without any means of transport (even worse, as caves at least protect you from the bad weather, these are all unfinished).
So the only way to keep this bubble going, is by sufficiently high economic growth, i.e. inflation. Or alternatively, they could reduce the rate at which they construct, and stabilize their currency based on the fictional value of these appartements. The government has to take a middle path with reasonable inflation, where they keep construction rate low enough, so the fictional value is maintained reasonably, while constructing enough to keep the market happy and construction companies alive.
This was really interesting, I travelled through China by car and I was stunned by the gigantic empty buildings everywhere and more going up, not to mention all the empty houses. It was mind boggling. Now I understand better.
Hi! I would love to travel by car through China. I wonder what can you find between cities? In my head there are lots of 10 million people cities separated by hundreds of kilometers of nothing. Is it like that? What can you find outside the cities?
@@PP-sj7pl I did not travel through the whole of chine just the parts between the cities where I worked so like 3 to 4 hour drives each time, there was very little country side, just never ending houses with no lights and manicured vegetation along the high ways, you feel that there are more than a billion people living there, lots of small farms with ducks, it was depressing. train stations in small towns on an absolutely huge scale..........I should have documented it........
I think there's a huge fully functioning airport out there somewhere that's completely deserted, but still "open" with one poor shop keeper in it. I remember seeing that video a couple of years ago.
"Real estate has never gone down." That's also what we said here in the US in 2007. Then in places like inland CA and NV and AZ prices fell 60%. In some places they have only now returned to their pre-crash levels.
@@jimmytenname2451 No. You have to account for the time value of money. It has recovered in NOMINAL terms, not REAL terms. That's a horrible investment.
It makes absolutely no sense & defies all investment principles. It cannot sustain. It's the classic ponzi scheme. Once the buying stops, the whole thing falls apart. It will crash here in the next decade or so when their population falls by a third due to their 30 year one child policy.
I'm amazed at how good you are at connecting all the economic, political, cultural, and historical dots and presenting the situation as it is in practical terms. Really good work! :D
Why would you invest in something you will never sell? Who buys an apartment in a ghost city? This will clearly collapse very soon. I don't think video explains this very well.
Good at connecting the dots? Did you get the part that a multimillion dollars estate in Shenzen can actually be rented as housing by middle class people? And they do not need to have 3 jobs to afford that?
These ghost cities have been built strategically in advance by the Chinese government before the stockmarket crash and coming global reset. China is building all this infrastructure and condos, houses to make housing more affordable, more accessible for their population as China transitions into the computer information, A.I., robotics time period. These future cities will be business an tech hubs, prebuilt housing for future workers, and allow China to grow exponentially. When the recession an reset happen, their recovery will be quicker, and they wont have spend decades building these cities during potentially down times, they can furnish these ghost cities much cheaper an easier than if they didn’t build them heading into a recession, and resetting the financial system, then it would be crazy expensive to slowly build this infrastructure later on. Ghost cities will get populated quickly over the next 10-20 years.
We lived through the land/apartment bubble in Taiwan in the 80's and 90's. It was awful- but not as bad or corrupt as the current mess in the Mainland. We rented a super nice, new, townhouse in metro Taipei in 1991 that was valued at $650,000 US and we were paying $635 per month in rent. That was completely furnished with Italian marble floors, custom lighting and all solid hard wood cabinetry!
What a steal - rent 635 for 650k house?! Wow so interesting.. I bet there was some tax exemption loophole, otherwise I dont see economic gain from renting it.
When I lived in Singapore, and a Chinese person moved into our condominium, I noticed that they removed every nice thing from their unit, including the beautiful marble flooring. They just tore it out in unusable chunks. I thought that was such a waste. America would totally recycle that.
I remember seeing these massive Sim City like developments going up everywhere over 10 and 20 years ago. I thought then that the real estate market would have to correct but still today there’s been no reckoning. I imagine the problem has only gotten worse and I remain confused by how it continues. This was a good video.
Evergrande was the first visible crack but has seemingly been kicked down the road yet further. Edit: I got curious and it seems another large developer, Sunac, just missed a major payment. My guess is that the government will do everything it can to let it collapse in slow motion and use it as an opportunity to exert more state control as they have in the tech and education sectors.
Don’t worry, I don’t know how there hasn’t been a reckoning either. I can only think that it must be the result of… well I would say corrupt but it goes deeper than that. The whole system was built to rot, out of rotting materials without ever being built to actually function. I don’t even know how the Chinese people and the CCP could fix it. The situation is totally illogical and I don’t understand how it was allowed to happen. But I know one thing without a doubt. If and when the Chinese real estate market does collapse the people that suffer won’t be the officials and higher ups in these corrupt real estate and building companies, it’ll be the common folk. Most likely the poorest people at the bottom of the housing ladder who can least afford it. But yeah if it was a country that didn’t have a horrifically brutal, evil and monstrous authoritarian regime as a government and I wanted to make a movie set during or after an apocalypse then one of those ghost cities would be almost ideal to film it in.
One thing that should be noted: the Chinese government does meddle with real estate. In some big cities, good secondary schools used to require you to live in a certain area for you to be able to attend them, which in turn allowed the properties in those areas to be profitable investments. The government stepped in and not only removed the requirements, but also started to randomly assign schools for students, making a lot of properties lose their value and become undesirable. Another example is that the government has also started to cap the amount a property can go for on the market, and in some cases can reduce its value to 1/2 of what it was. The Chinese real estate market is no longer a reliable form of investment for the majority of people, clearly indicated by the current market saturated with housing for sale (and no one to buy them).
Here's some more details: a lot of people who currently own housing bought their homes before the housing market expanded (~6 or 7 years ago I think), so many of them are the lower middle class who had just enough to purchase a home then. Most properties are also not solely for investment-the avg person doesn't have much money to buy extra homes-and are the exact same homes they live in. Now let's say you want to improve your living conditions, you really can't. Current prices for homes are still too high and you can't even liquidate your old home. Wanna move to another city to get better jobs? You can't. If you're lucky, one of those residential development companies will decide to tear down your apartment building and build a new one. You can take the cash compensation or pay a little extra to live in the new building that may or may not be completed. Oh and the compensation is sometimes not enough to buy a new place to live either.
But it will be enough to pay the rent for one year on some ramshackle no-plumbing hovel you have to share with your in-laws. Just try to find a job that pays similar wages as the one you lost.
Finland used to have a reverse problem, because every young person flocked to big cities, rural housing went so cheap some houses were sold for 1 Euro and banks granted negative interest rate mortgages, meaning you actually pay back less than you originally loaned. Coronavirus put a stop to that when it caused a city flight, now our housing market is balanced. I've read that Mongolia and Japan had a similar problem with demographics too.
Yeah, I live in Japan and it's the same. You can get houses for pretty much free. However they are like 50 years old and being swallowed by vegetation. Most people would probably find a tent preferable lol not to mention you are a 30 minute drive from even a small store and probably an hour or more for anything that resembles a modern one and you of course have to live in them as part of the deal. I love carpentry and would love to have one as a fix me up project on long weekends and use as a villa but they want you to live there and help out the local economy/population.
@@makokx7063 the government will need to loosen up on those regulations. In Alaska, you can still get homesteads basically for free and you don't have to live on them full time.
@@bagofpennys7457 I doubt anything is going to change. Japan's birthrate is something like 1.3 so they already are running out of people. No incentive to get them to relocate outside of the Tokyo and Osaka areas. As an American though I would love to get an Alaskan summer home lol
I am Japanese. Sorry, my English is not good. You cannot get a house for free. If you are in the countryside, you can buy a house cheaply with city assistance. In general, except in the city center, it is possible to buy a house normally. You work normally and buy normally.
This is very prescient considering this was released 1 yr ago. I love your show because you’ve lived there, still know people who struggle through life under the CCP, and you’ve been all over the interior. Who better to give us the real inside stories? Just awesome! ❤️😊
In some ways it is like a reality world version of an NFT. Edit: I would like to introduce a new term. "Ghost city" as originally coming from "Ghost towns (America)" should really only apply to places that were once alive with people but "died" as the people left for one reason or another. Given that these cities were never alive in the first place, then the correct term should be "Stillborn Cities" or whatever the Chinese word for this is. They were born already dead. 😬
I thought the same thing, or close enough. Rather I thought it like bitcoin, or tulip bulbs, or shares (very pretty paper too) of the South Seas Corporation. But given many layers of financial derivatives in the markets, the real estate valuation, while unimaginably stratospheric, is just the tip of a hyper-derivative-ized bubble of counter-partied "moral hazard" "contracts" of some fabled monetary value. When it drys, it may hyper-dry, and all the cohesiveness of one people becomes like the cohesiveness of the Gobi sands in the dry and windy season.
A relative who travels to China tells me that if you don't see electric Heating Ventilation and Air-Conditioning units on the exterior walls, then it is very likely to be unoccupied.
Crazy to not even have Heating in a hi rise. Why even have a roof and windows if usability don't matter? Guess China gdp will stall at $10,000 per person forever, at least Japan got to $40,000, that's why China shouldn't brag they are stallong out so low I feel bad. The top 1% running factories or govt stole $20m of wealth net last 20 years or $1m yearly , if given to 99% workers that's $10,000 per worker ($1,000,000/100) the worker didn't have but should've got yearly so extra poverty for them due to corrupt system not paying hardest workers on planet ... Darn commies...
Near zhuhai there is a massive complex of ghost luxury villas. Really fancy villas that are overgrown with tropical grass and wild dogs. Is a crazy sight to see.
Twenty years ago, as a kid, I thought "Hmm, China is probably trying to provide more homes for it's big population. That makes sense" It's only recently that I understood what's going on with those cities.
If they gave the housing to the poor, at least it would had an social function. But they made them in middle of nowhere, not where there is actual demand (beijing and other big cities), to try to not crash the prices by overbuilding. Begs the question what will be made of it, once the inevitable finally happens.
The China population will not be half of what it is in 20 to 30 years. Already more than half the population is older than 40 and childbearing aged couples are choosing not to have children with a dystopian future. It isn't just the West with this problem.
That is due to capitalism. You're correct in that if these massive cities were built with socialist ideals, it would make sense. But capitalism only cares about one thing only, the bottom line. Thank you for bringing up this observation comrade.
This was a phenomenally well-written piece of journalism. I’ve never heard this topic broken down into such a clear and informative way. It’s all just so damned... crazy... that this is why all of these ghost cities exist in China.
@@brianlandi6920 Wow your comment is pretty negative! I don't think the OP was particularly criticizing China, he was just giving info most of us didn't know. You seem to be a little sensitive on a subject no one said anything negative about. Why wouldn't we like that China has made advancement bringing people out of poverty? Just the fact that you feel the need to justify it makes it look like it's not as positive as you'd like to make it sound..
I went to Weihai about 12 years ago, to do some tourist stuff, and to meet a gal that I was a pen-pal with. We went to the Sino-Japanese War Museum on Liugong Island. It was pretty interesting, and people were mostly nice. I went around the city a bit, and there were these huge apartment buildings everywhere, but I never saw many people around them. In the day it was pretty busy in the city. Some Russians on the beach. It was a challenge to get across the streets without getting run over. At night it was like a ghost town. I saw clubs advertised, but if I went there, they were always gone, or closed. I had a cab driver drive me around in the evening and there was nothing going on that I could see.
The Weihai is pretty boring area and still is. You have to go nearby Qingdao it’s more fun. You got only the good seafood and good university there and nothing else in Weihai. A lot of rich Koreans go there to date or try to marry the pretty tall Shandong gals but a lot of them already left for the Tier 1 cities.
I really miss you two taking those tours around China, but I'd rather see you both safe and away from their tyranny. Thank you for all your years of dedication.
I know you explained the whole thing with value and culture...but I still cannot wrap my head around such waste and debt! The borrower is slave to the lender
And since in a system built on debt practically guarantees that the issuer will never recover the loan from the borrower because it's a pyramid scheme, that one day it must all come crashing down. I doubt the Chinese government could guarantee the loans in the event of a meltdown. Instead, it will instantly nationalize theses properties to avoid that. And the poor fools who bought the "King of Debt" apartments will be wiped out. Depression, poverty, starvation, collapse of China. Only the "government" will survive. It owns US gov't. bonds.
When I was living in China, there were a couple of big scandals where people invested in apartments, and couldn’t sell it for a profit. They sued saying the company GUARANTEED they would make a profit.
We visited China before Covid. As we moved around the country all we could see was half built cities marching off into the horizon everywhere. We came to the conclusion that there was a fortune to be made manufacturing high rise cranes.
You basically foreshadowed the collapse that’s happening now with this video. All these other TH-camrs are doing superficial research and saying the same things….. But here you are with boots on the ground footage. You are definitely a gem on this platform.
@@cyrusol *Currency* is debt. _Money_ specie is wealth. Availability of goods and services is an economy. Even specie money is worthless if there is no semblance of an economy.
What a wonderful world we live in. I find these cities to be awe-inspiring and beautiful. Perhaps the massive influx of android-citizen creation in the coming decades will help to populate these buildings.
I remember when me and my family were driving between the big cities in China like Beijing, Tianjin and so on, when we were driving along the highway, we would always see these random clumps of apartment buildings in the middle of nowhere next to the highway with nothing but mountains and grass around them with nobody living inside them It was somewhat creepy to look at and I've always wondered why those buildings were there, big thanks for you talking about this topic!
You can go over there later and see full of people there. Beijing is different from all the other cities in this video and you will find out every one live in Beijing trying to buy a apartment around Beijing no matter how far away from the centre
@@brianlandi6920 You really think people are that stupid? He is showing you all the empty buildings that are falling apart because they haven't been maintained and yet they clearly are not being worked on now and haven't been touched in years. We are not blind. Take your CCP propaganda elsewhere. Here we think freely. China is a fantastically interesting culture and people trapped by a horrible government.
@@brianlandi6920 This guy was just showing you the physical FACTS. Difficult to make a positive case for so many shells of cities everywhere. If it works for China, that's great. They are playing the long game but it appears they may also be playing with fire if things don't improve. Evergrande has lost approximately 90% of its stock value (S1.40 in June 21 and now $0.14 in June 22).
Visited a strange little ghost town outside Shanghai. Based on a quiet English village with Harry Potter statues randomly about. Was mainly used for couples having wedding photos. This was back in 2012 Edit: Thames Town
The most disgusting thing to me about seeing these ghost cities is thinking of how the resources could have been used to better people’s lives, ie in other poorer nations that really could use basic shelter, or any other number of various things. Even a small percentage of the raw resource sharing would have made a far more positive impact elsewhere.
It is not China's responsibility to worry about their poorer nations. Other nations must handle their own problems. I come from one such nation and the issue lies with our politicians and corruption. Even if China were to send all the money, nothing would be accomplished for these countries. Furthermore, China, like other countries, has its own people to take care of
China got ghost cities and a dishonest government that's manned by corrupt communists. While US has a homeless population crisis, and dishonest government that's manned by corrupt businessmen.
The amount of highly leveraged debt that has been used to prop up the chinese real estate market is insane. The fact that it has taken this long to unwind, simply shows how catastrophic its collapse will be. This bubble could decimate the entire global economy once it pops.
I spent many, many hours driving through open country in China from 2005-2008 for business. I traveled routinely between Shanghai and Ningbo long before the massive bridge project. I remember traveling with my colleague in a station wagon with a driver that spoke no English down endless new highways with scarcely a soul on them. Highways transecting it only going out a kilometer or less before ending in dirt. On the horizon I was struck by the multiple building complexes springing on the horizon like Asian Emerald cities. Most it seemed were three towers or five towers, but never four. I was told it sounds too much like "death" which was kinda prophetic. As the sun went down and after 3 hours of our driver relentlessly honking the horn for no real reason I noticed something. As the light faded not one of the high rises had lights on except often what looked like one apt on the ground floor. These were empty. Seemingly thousands of apts and condos in total darkness. The ghost cities were already well on their way. Thanks Serpentza for your insight. The China I remember from those years is not the China of now. I have lost friends who see me now as a nuisance and part of a decadent society. In retrospect in general we were played in business with the false sense of being a "partner" or "good cooperation" as they liked to say. Only as long as we filled their coiffeurs with money. I had an ex friend during the COVID pandemic tell me we in the US deserved the deaths we were recording because we did not follow the sound practices of China and that the didn't really care what happened to us. I responded, "that's sad because unlike you i do care what happens to the friends I made in China.
this is by far THE BEST VIDEO EVER that I have seen on the Internet that explains so well the reasons behind tha madness of the chinese housing market. economists cannot understand the superstition of the average Chinese and such a huge difference between a rent and a monthly mortgage installments.
They've had other videos on this before Covid, but it hadn't started to collapse. Laowhy or C-Milk had an episode where he complained about ever buying a junk apartment that started falling apart the 1st week.
I mentioned these ghost cities to coworkers and friends...they looked at me like I needed a tin hat. Sometimes I feel like Cassandra cursed to never be believed.
Most people go through life with their heads stuck up their asses, totally oblivious to the world around them, it really amazes the shit out of me the complete ignorance.
Well I was surprised to have an Ugandan Uber driver who knew of and watches serpentza and laowhy86 and ADV China, too. So there are people in the world who are tuned into these guys and understand that what they're saying is for real.
I most of the time head stories about china needing these apartments for future growth and that they are planing far ahead. This however is a way more reasonable explanation. Thanks for the insight.
Just outside of Beijing (about 1 hr SW by train) I saw high rises from horizon to horizon, all identical. The thing is I didn't see more than a few cars. A near total lack of AC units in the windows was indicative of unoccupied buildings. I was told by a local that part of it was there was a big investment push to get average people to buy into these projects as investments. The problem is it turned out the units were too expensive for the avg person so it crashed. I was joking that China's state bird is the tower crane.
This is 100% accurate. I had visited Suzhou outside Shanghai some years ago and saw one such ghost city. There were trees growing out of the walls of some empty flats. Those buildings are never going to be inhabitable and must eventually be demolished. Most of all, I feel sorry for the ordinary Chinese citizen.
How can you explain that the Chinese keep paying for these flats when they know in 10 years or 20 they will be worthless? This is what I do not understand.
One example of corrupted power. A similar situation exists in other countries, particularly the USA, in building up their military far beyond what’s needed just to keep the armaments industry happy.
They will be fine. Not finishing them off is smart as that would deteriorate. Concrete will be fine, and when the time comes, they will be finished and sold off.
@@romanjimenezgil I guess they just plan to sell them and make a bit of profit before they become worthless. Or maybe just by owning them, and thus having an asset of some sort, they're more able to borrow money to purchase additional property which is a better investment. I don't know exactly how it works in China though, as I've heard mortgages are very uncommon in China, and most property buyers pay the full price up front.
Thank you for your explanation for why these apartments are left unfurnished. That makes a lot of sense. Culturally, it seems there seems to be something related to new construction versus ongoing upkeep in China. Please let me explain: In 2013 I visited China and visited a new science and technology museum in Guangzhou. From a distance it looked spectacular! It was full of interesting, hands-on exhibits. However, the museum was only a few years old, but about half of the hands-on exhibits were broken. The museum atrium was leaking water from the roof in several areas. In contrast to this, in a 2016 trip to Japan, Tokyo is not nearly as new as the construction in China, however the airport seems to be very well maintained and very efficient. There seems to be some kind of desire for new flashy buildings but then when the buildings get constructed there seems to be little desire to upkeep them. Has anyone else noticed this in China?
India had this phase back between 2005 to 2015. There were massive defaults then by construction companies, and the market started giving crazy awesome returns, so the last few years has only seen genuine home buyers buying up houses, and nobody takes them for investment anymore. Our ghost city phase is over and was not even a few % as big as this nonsense. Thanks for the vid !
This is the purpose of free market forces. To keep you from doing too much stupid sh**. This is why govts need to stay out of bailouts as far as possible. It is one thing to step in to ease the pain or bring about a managed collapse. Another to hold back corrective forces entirely. It would be like you have a hairline fracture in your foot, but instead of dealing with the inconvenience of staying home and missing out on stuff, you take painkillers and keep on keeping on, all the time making your underlying problem worse. Then all of a sudden, the hairline fracture gives way completely - and then you blame America. 🙄
Companies like Unitech, JayPee, Supertech, Amrapali etc ( most promoters being erstwhile local goons) went on land buying spree and started projects after projects and also siphoned money for personal gains. Now they are bankrupt. Unlike China, India has buyers who wants to live in the apartments they buy. Of course there will be investors. Alas these builders duped many home buyers. Maybe these Chinese companies could have built apartments here (provided they maintain the quality. I remember a video by Serpentza where he talked about the shitty construction standards in China).
Interesting! What happened to the ghost cities in India? Are they now populated? Can't seem to work with what I see in this video, I doubt they did any basic electrical, freshwater, drainage, infrastructure (and so on) work there. That's nearly impossible to build all afterwards
@@luke1811 I myself live in a 'Ghost city', which is to say this place was very well developed but didn't see people for a long time. But come Covid, these places are now exploding in popularity. Thie difference is in India, there's so much demand for infra, that demand always precedes supply. SO,, there still indeed are empty buildings, but given time, population should arrive.
When I visited China 5 years ago the ghost cities were something I will never forget. It felt like I was witnessing the apocalypse. Driving into Xian it felt like the empty towers would never end.
I've actually seen this 'ghost town' on my trip in Hainan, I remember there's a lot of apartment tower all lining up like 5 of them and they're all empty. It's really an eerie feeling especially at night
It’s so bizarre. If you don’t have people living in these structures, there will be no one to maintain them and they will eventually fall down, but not before making a terribly awful blighted sight. How do I know this? I grew up near Detroit and I saw how fast a whole city can fall apart when no one lives in the homes or conducts business in the commercial buildings. So when I say this is bizarre I mean to me I can’t fathom why you would build a Detroit, but skip the part where it is thriving place full of people and opportunity and just skip right to the part where it is empty and about to fall apart.
and Detroit was a beautiful city when it was thriving. A lot of the architecture that is falling apart was exquisite. Detroit and the ghost cities are the result of corrupt and putrid governments. I hope Detroit can one day have an honest government so the people there can live in peace and prosperity.
One of the greatest tricks of the past 120 years was convincing man that living in crowded cities was better than owning rural land in the countryside.
If you can somehow isolate a man from his natural enviroment which is nature, you have control on him. He simply becomes your slave who's living adapted to your rules. That's how western commercial propaganda works. Naive man full of dreams is realising direct message which is, "Move to a urban populated cities, work hard, get a credit from a bank, buy house and car, achive your material dreams and have a good life", but he doesn't realise subliminal message which is, "You'll paying back your credit to the rest of your life, we'll force you to work hard for us and our economic system, you'll become our slave and we'll take from you even more through paying taxes, you will suffer, be unhappy, sick, and we'll selling you a toxic medicaments to make you even more sick and keep draining money from your wallet you're gonna krrp spending over and over on medicaments". Only a smart man who's aware all of these things and how actually entire system works in general can live in a city, have a smart way of living and keep himself of falling into a death trap I mentioned above. Only this kind of man can do a lot of things in his life, have a success and be free while others around him are stucked in isolated carantine of slavery exploatation. When a man is aware, he's not gonna do one single wrong step. He came to a city seeking success, not to become a slave. His path will be extremely hard, but everything is possible, one man can outsmart entire system if he's smart and dedicated enough. Ps. Let's think a bit together: Do we really need to have something expensive, for example, the latest iPhone, devil's cloth (balenciaga), rings with diamonds, Mercedes car and things like that? My real question is: Can we have a normal life without all of these sick trands as social deviations? If your answer is YES, than you're free, not a blinded slave to a capitalistic-consument infrastrastructure system for exploating man into a hard working and producing machine.
This is a helluva statement... especially since cities are MUCH older than 120 years. There is nothing wrong with living in a well-regulated and maintainted society. There are many countries the world over who have cities that are beneficial to the people who live in them for a variety of reasons. You wanna go live on a farm? Great, go do it. Stop pretending like it's a better option for everybody. It's not.
Probably because of the invention of electricity, phones, and then the Internet, all of which were only available in cities originally. Also, well-designed cities have quick access to almost every service, e.g. stores and schools are often at a walking distance. And yes, I definitely believe cities are better places to live in general, though I'd rather live closer to the edge to avoid exposure to excess pollution.
I was just thinking that. In all the years of watching Star Trek (original) I don't recall any episode where they met something like encountering a -dead- stillborn city that had never been lived in.
You guys provide so much valuable information. Many years ago I heard about ghost cities and attempted to find out more about these as I invest in the market. It wasn't until I stumbled upon this actual video did I find any valuable information. You guys provide high quality content. China housing market dwarfs the US 2008 housing crisis. Hold on when this falls apart. Stay awesome and safe.
I first heard about ghost cities on 60 minutes several years ago. They did a story about people who were fighting the government to protect their homes from being destroyed to make room for a city no one would live in. They lost.
I remember back in 2008 before the Olympics and the housing prices went up a lot. Everyone and their grandmothers built 4 brick walls with a roof in hope of selling it off and make a fortune. At that time I was up in Hami in Xinjiang and villages were surrounded by these hollow brick boxes. Still today I sometimes wonder how many of them actually got sold.
As the government builds more infrastructure they buy these properties from the owners. Sure, they just get torn down to make way for roads, trains or buildings but that’s why people build on their properties.
To invest in a largely unlivable depreciating real estate asset is truly the definition of insanity. Once the reality of this sets in that's it regardless of the CCP.
I disagree, prices will crash and some will be ruined, but the government will bail out key players, a recession will occur and the Chinese GDP will shrink slightly for the first time in many years. Western countries have had shrinking GDPs and survived
Waitingforrealitytosetin Real estate does NOT have a Life. Thus it is neither livable nor unlivable. However it can be > habitable or inhabitable Undertake an extensive reading program to better educate yourself and improve your knowledge of the English language and literacy You can do it. - Start immediately and invest in yourself Good luck and good bye
Who knew that some intelligent observant dudes on motorcycles wearing leather jackets could sum up so well what is being hidden from the world. Good on you mate!
One gets the impression that these developers get cheap loans/grants from The Party, half build these developments and run off with the rest of the cash. I might be mistaken.
So glad to have found your channels and actually understand what is going on in China! 'Pay no attention to that man behind the curtain' springs to mind! Keep up the good work. 🤟
This is scary. Pretty much anywhere else, when the bottom drops out of the real estate market (and this happens), you can reasonably expect it will eventually recover, simply because people still need places to live and work. The ONLY thing these Ghost Cities can do is just sit there and be valuable, you can't actually live in them. Even assuming a buttload of people suddenly wanted to, for some reason. If the Chinese invested as much in Gold, and the bottom completely fell out of the price of that, you could still use it for electronics or even just to line sewer pipes or something. But this? It will end very very VERY badly, there is no upside, no path for recovery if / when things go wrong.
My friend and his wife have been trying to sell their chinese investment apartment for quite some time now, and now everyone is locked down so impossible to sell anything, they are regretting buying it instead of buying from their new home country.
I have personal experience with the construction in China. I am married to a Chinese doctor (2003 till now)as well which allowed me to visit several sites because of her contacts with a bank senior manager as well visit homes of some of the friends and was shocked to see some of the conditions. As a construction superintendent (35yrs) in both light and heavy construction, it was immediately apparent a major problem was the sand they were using (dirty). That's why you see the scaly corroded areas around the cracks.
Dennis, disturbing , thanks for sharing. Covid-19 , Supply Chain, Ukraine war/invasion and a China generated potential property crash. Who knows what comes next !
"dirty sand" is used for the filler walls, not the main columns and beams. I have been a construction project partner in China, where I have lived for the last 17 years, and the building code is just fine, unless you have some evidence of buildings collapsing that I have never seen ..?? Would you like a list of building, bridge and other structure collapses in the USA while I'm here?
I used an apartment in Nanshan Shenzhen and another apartment in Zhuhai for my business. The first was in a highly utilized place with meaningful value and excellent local jobs to pay the bills; and the latter was in an empty new building in a ghost area with low-income jobs unable to pay bills for such apartment. Problem is all these ghost areas made in areas with no jobs will never become sustainable.
But they've already done their purpose. Imagine the amount of $ that has been lent because some chinese developers came to the bank n said they have some high rise somewhere worth x amount of dollars. The entire global economic system is a giant sham
@@markae0 But they have no power grid, sewer system, or water. It is a building frame. There are no elevators and most of the buildings do not even have stairs. They built the building without even a single staircase.
@@andrewh1113 .. are you sure china buildings no power or water or elevators, I see some lights... With concrete walls they must run conduit otherwise it's too late ..
@@markae0 From what I've seen, those ghost city areas are often not with easy commutes to areas with great jobs. For example, the Zhuhai area I mentioned will need first a taxi trip, then a boat trip for getting to Shenzhen and from the ferry terminal in Shenzhen, you can spend a long time in a subway train to near your work place and then take another taxi to your work. Besides the commute time, people won't have the money for such commute. It appears to me that these ghost cities were made specifically with consideration of where it was cheap to make such buildings (= areas with few jobs) rather than where it made sense for enabling an income paying for those housing expenses.
Yes. That was in the 90s and Japan had never recovered from that bubble. It did not let its banks fail ( stupid US did the same in 2008) and now is highly leveraged,
The Chinese did this in Vancouver as well. Bought up neighborhoods of homes and didn't live in them, then I saw the game come to Los Angeles. Foreigners offering 5 and 6x the asking prices of homes in LA driving the real estate market through the roof. When that started to cool off I began to see building around Hollywood, some on neighborhood streets, some on main thoroughfares being destroyed and new buildings going up. It has made chaos out of these streets as they were not made for the amount of traffic now using them. China and the US have the same strategies, 0% interest rates and all.
I lived in South Korea for a few years teaching at a university- i was headhunted to go to Hong Kong the entire time - after finally saying yes and doing due diligence - I thought it was going to he amazing - after arriving I found that I was actually teaching babies in diapers that could stand or speak in general - in addition my apartment was was over 2 hours away from the school on the border in China - it was insane - I left after 2 days on a midnight flight
The other huge issue with these constructions is that almost all of them have been built with substandard materials and building practices which means within 10 years most of these buildings will only be fit for demolition....
I suspect many will collapse on their own accord too. You can't have empty husks of buildings with no windows or proper ventilation, especially in some of these humid wet areas and expect the concrete / steel to last, especially not if its not built correctly.
@@levelazn No myth buddy. I lived in Shenzhen for over 2 years and I can tell you from experience that buildings less than 10 years old are indeed literally crumbling. I lived in a 32 story apartment that was only 5 years old and saw whole sections of wall tiles just slide off almost hitting people walking by. In Shenzhen Mall there was rusting reinforcing steel breaking through concrete columns and at the time this structure was also only around 5 years old...
@@baarni how come I never saw that when I visited China ? I live in the us and the infrastructure sucks here. Roads have potholes and bent my rims 3 times.
@@levelazn Dude, I don't know about the US but I do know what I observed in China.... Building practices are scary dangerous... To be honest though the roads in China were awesome, that is something I never had an issue with... I live in Australia and can tell you the roads in China are way better. I have pot holes everywhere here too.
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I've actually visited these ghost cities and have come to understand exactly what secret is hidden in these bizarre concrete labyrinths, thank you so much for supporting what I do by watching my videos, you're all incredibly awesome!!
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Having high GDP, makes China look more legitimate as an economy.
It also attracts more foreign investment into China.
However, China's able to fool everybody because they calculate their GDP differently from every other country.
I'd share a video link from a respected Economics Professor, Michael Pettis, but I'm confident this comment won't post.
Essentially,
The world calculates their GDP from investments that actually contribute to the economy.
If the investments do not contribute to the economy, then their impact on GDP is reduced.
Not the case with China.
China does not reduce their GDP if there's no economic impact from investments.
Therefore, as long as you keep building and constructing, regardless of their contribution to the real economy, their GDP stays artificially higher.
if you find
Kyle Bass and Michael Pettis
and go to 32:33
you'll find where Michael Pettis explains this in detail.
You'll see the smile from Kyle Bass's face, when he hears this, because he knows how BS it is.
So, it's a state sanctioned pyramid scheme... good one, China 🙄
Sooo a large part of chinas economy is baced on the pyramid schema? And now they reach the point where they cant cover the depts quickly enough...
Good reporting guys ..thanks
Apart from being an absolute tragedy in progress financially/economically, I'm devastated at the thought of how much damage this has done to the environment, and how much raw materials which, today are in short supply, have been wasted.
Yes, it is crazy. There's not enough sand for concrete and at the same time there are so many empty buildings in China
Also bare in mind, most of the land these cities are built on was arable farming land. Farmers who had farmed here for generations where kicked off the land to build these cities. Another food supply gone with each city. Didn't learn much from the sparrow debacle did they?
The planet literally renews itself. The vegetation will overshadow all that was built long before humanity kicks the bucket. Give nature enough time and it will find a way. It always did, always does and always will
@@windsorSJ I’ll be honest, I didn’t think of that. Knowing the CCP I truly doubt that the farmers they kicked off that arable land were paid for the destruction and loss of their homes or indeed received any compensation worth all they lost. By compensation I mean other things than money such as a new, comfortable, adequate place to live and new jobs to replace what they got being farmers.
But if I understand China correctly then nobody actually owns the land they live on, they just lease it from the CCP for like 90 years or something like that. I think I read somewhere that there is a degree of class separation in China with rural people being the lower class, with their passport or other forms of ID bearing a symbol or colour marking them as rural even if they move into cities. And so being denied a lot of things such as going to university. But take that with a pinch of salt because I don’t remember where I learnt it.
The residents did that, they didn't know what they wanted and moved away.
I'm a mortgage broker. However this finally ends.... it can only lead to a depression in China worse than has ever been seen in human history. It is impossible for me to accurately relay how bad it is. The 2008 US housing crisis is absolutely nothing compared to this. It is a fatal error made by the Chinese system - it will kill their government. Literally.
Itll be a cgance for the rest of the world to detangle themselves from China.
Ironically, ending the CCP would be the best thing that ever happened to China. The CCP CAUSED this housing debacle by restricting productive investment and capital markets. Communism is the worst system of goverment ever created, it has failed everywhere it has ever been tried. Compare mainland China to Hong Kong or Taiwan which are sort of like China without communism and you can clearly see which system is successful and which is holding a country back.
@@gordo3582
But it would be the worst thing for the rest of the world. Since we wouldn't be able to produce iPhones for less than 300 bucks to sell them 4 times a higher price
When it collapses it will take the world markets with it.
Good,,, I hate communists
My Chinese wife wanted to buy a second apartment, but I rejected her: Not only are the prices unaffordable, but also the value of a property is always subject to supply and demand. If almost every family in China as two or more houses on average, who would buy your apartment if you were to sell it later? If there's any point in time where many people want to sell their apartments, the prices will drop significantly, and you could only sell an apartment at a loss. It's a bubble, nothing else. And the worst thing is that building all these houses is a giant waste of resources and pollutes the environment for no valid reason. It's terrible.
Winston who's no Churchill has a Chinese divorcee as a wife. In China divorcees are shunned and stigmatised that's why she married Winston. She's second-hand goods.
@@franktoh3041 I don't think that's anything you can justifiably assess and even if that would be the case, it doesn't matter at all.
How many housing units are there, per person, in China? Is it 2? The Chinese government will bail out key players in a crisis, just like in the U.S.
@Крис Фуллер yes, but no. Do China print dollars?
And with population growth slowing/reversing too making it even worse
Never been to china, don’t plan to, but recently I went to a city that was dominated by the Chinese in Cambodia called Sihanouk ville. It was SHOCKING the amount of empty buildings, empty hotels, restaurants, casinos etc.
The local Cambodians left because Chinese investors bought all the land and started pushing local businesses out, this causes tourism to die out as people want to go to Cambodia for Cambodian culture, not Chinese (all the stores, casinos etc were all Chinese dominated). It’s honestly so sad to see.
They've been doing that to a lot of countries. When the pro-China former Philippine president shuttered Boracay island (a major tourist destination) for cleanup, dozens of Chinese restaurants sprung up after the island reopened. And what's even more insulting is that their menu are all written in Chinese only!
I'm glad that has come to past and most of these restaurants closed down. The current president is thankfully pro-Philippines.
@@Yjn75Was that Duterte?
@@ilikecarsandtacos Yes it was. And it's the reason a lot of Filipinos are blindly pro-China as well (his followers)
We went to Sihanouk villi last year and decided never to go there again. Sea looks very dirty as well.
There are chinatowns all over the world. You gotta think why aren't there more America towns or Norwegian towns. Chinatown is everywhere.
Meanwhile there are millions living in squalor , barely a roof over their heads ... What a waste ...
What a damaged world
yeah its sad to see, human ingenuity going to waste
Send them to live there
This is what capitalism has brought to the world, uneven distribution of wealth and overproduction.
On the bright side, the climate in the area where these houses are located is actually good. It can meet the housing needs of hundreds of millions of people.
@@timbercladdingcn - and yet the even distribution of wealth communists tried on some of the largest land masses in the world with some of the largest population densities ever decided after failing miserably to go for the ‘unfair distribution of wealth and property aka capitalism. So much for the woke snowflake ideologies, hmmm? 🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣
@@timbercladdingcn Bruh this is the dumbest take. It's literally Communist China you are talking about. None of this involves creating competitive products that actually have demand, it's all artificial fakery that is the masterclass of communism.
In Nova Scotia there was a property tax loophole that assessed homes still under construction for just the land it was on. This resulted in people nor quite finishing construction by not building the front door steps. Driving around rural areas you would see many homes without doorsteps
This sounds a lot like the unfinished houses in Greece a couple of years ago
@@mrtoasteer3561 ...most of Eastern Europe was like this as well...you would see homes fully occupied with no finish coat because it's considered incomplete and taxed at a different rate...
Mexico was doing this 20 years ago. Many buildings had the start of a second floor. Rebar sticking up where the walls would be.
So funny how governments policy create unintended consequences
Couldn’t pull this in Australian
It's pretty sad.
Here in NZ, our home has practically tripled in value in ten years, as successive governments have utterly failed to keep land and building prices reasonable. Young people are pretty much locked out of the market today. It is a national tragedy.
I was looking at a chart the other day of house price increase for each country over the past 40 years, and we had the highest with a 500% increase. For comparison, next was Spain with a 350% increase.
It’s an international tragedy. The same is happening everywhere.
Our standard issue 1970s 3b/r house in Masterton doubled in price in just under 4 years.... Would not have been able to afford to re-buy it...
Same in Australia 🇦🇺
Same in Canada. After a divorce twelve years ago, the family house in Toronto sold for 440,000. Today, it would be 1.5 to 1.7 million to buy it.
They're treating modern concrete like NFTs...
perfect comment.
In near future blackrock and other want tokenize everything, except nature
I'm a mortgage broker. The fact the mortgage payment is $4,400 while the potential rent is only $705..... I mean, that's absolutely shocking. That is unbelievably bad. I've done mortgages for just about any type of property in Florida and that is so much worse than anything I've ever seen that there are no words. That is an issue so severe, if it were going on in the US, my only reasonable prediction would be another Great Depression. It is impossible to accurately relay how horrendously bad that is. That's 100× worse than any market in Florida - I am being completely literal with that. Their housing market is a ticking nuclear bomb
Hey Joe, could I ask you a couple of questions via email? Im a first time buyer soon and want human answers as opposed to Google.
Even if America has a higher cost of living Compared to China the quality of life is better and housing is considered a human right
@Evonne C the whole family often pays towards it
... the bigger bomb is debt bomb, if your city and local factory took out debt from rich 1% to subsidize sales of laptops to undercut japan by 20%, and eventualkg both are at 200% debt to sales so at 10% interest have to pay 20% of sales revenue as interst, , , ,. So suddenly undercutting becomes overpriced by 20%, running out of debt ruins so many businesses till then they magically sell lots cause it's not full price.... Can China recycle all that concrete, why the F did govt do this, is used concrete valuable? Nah.
@Gretchen K. of course thee sis homelessness it’s just the numbers compared to China when it comes to homelessness is very low only less than 500,000 people late homeless most live in Cars Trailors and Homeless shelters in China there are Millions kg homeless people who don’t have a house they own
For a country which struggles to feed their population, I find it utterly disgusting they take away farmland, or build on potential farmland.
Fr, I was in China during the massive dam project that was set to flood generations upon generations of farmland and villages. I took a boat ride down the river during the dam construction, and you would see markers in the middle of towns indicating how high the flood waters would rise. The markers were up one or more stories on buildings. People had to see that visual reminder every day years before the project was fully completed (it was done in stages, but still). I heard and saw so much propaganda about this project along the way, and it made me sick. People I spoke to in the small towns and villages varied between optimism, even though they had only ever farmed because they believed the government would house them in fancy accommodations and train them in shiny new jobs (but this was likely factory work), and straight up contempt for a government they knew was pulling the rug out from under them. So, I’m not one bit surprised.
They're trying to do the same in the Netherlands and the UK.
china got stupid once an got overan by a small steppe tribe ...
this is straight up a lie, the chinese hunger index is less than 5, which is the lowest category, they dont have hunger problems
@@kritischparken - Culture or not, when you eat dogs and hard boiled eggs soaked in boys urine (REAL THINGS), plus the influx of fake food - I would say the problem goes beyond hunger.
A friend of mine is a landscape architect and he spent a lot of time working in China back 15 to 20 years ago. He told me this same story way back then. They continued to build cities when others remained unfinished and/or empty. He said it made no sense then either.
irl feature creep
@@thisgoddamusernamestoodamnlongonline guy with no friends creep
I guess he gave some body a job .
@@NomadicByNatureno a lot of countries actually owe them money
@@david4096that somebody was him
Riding through a ghost city on a bike sounds like a bucket list item!
I agree. It suits me as i love the last of us feel
What we see in Australia is the Chinese will pay absolute top dollar for apartments. This just sets up a unrealistic real estate bubble price while the Chinese pump the market paying too much. When they stop pumping the market thats when the bubble starts to pop. That's the point were at in Australia now.
Same here in Canada,I wish they would stay on their own side of the ocean
Here in the US too.
Same in New Zealand. The large influx of a Chinese buyers that started in the 90’s and continued until recently, has inflated the market to ridiculous levels.
From Australia too and also bloody sick of it
@@Susweca5569 it's more than that, there's just a ton of people immigrating to canada, us, australia, etc..
We took the high speed train from Beijing to Xian a couple of years ago, a 1200 km trip, took about 6 hours.
I was amazed at how many of these huge apartment blocks we passed along the way.
That high speed railway looses hundreds of millions per year.
@@bloodmuffin123 but the net benefit to the economy is positive.
@@yikyak4249 by definition it is a net negative. You cannot take multiple fiscally negative measures and say the net benefit is good. It's like wasting money on war and saying it helps the war industry grow when that is resources stolen from the rest of the economy
@@rejectionistmanifesto8836 It feels good for normal citizens, and the population of China could reduce the loss for a bit
@@bloodmuffin123 Actual billions. China's whole system is a Ponzi economy like Winston stated on debt.
That includes high-speed trains, skyscrapers, bridges, luxury apartments, mega airports, and airlines.
Every project that is listed is losing money.
For your viewers who want to understand why these ghost cities keep being built, the person to read or listen to is Michael Pettis, professor of finance at Peking University’s Guanghua School of Management. One of his insights: whereas in most countries GDP is a measure of activity taking place in the private sector, in China GDP is a TARGET that the CCP sets every year. The provincial governments then have to meet that target. If organic growth coming from the private sector won't meet the target, the provinces then build these Potemkin villages financed by state bank loans. But China has enough infrastructure now, so the R.O.I. on these newer projects are often negative, but still count towards GDP.
The ideal solution would be for China to shift from being an investment led to a consumption-led economy like the U.S. but this is unlikely to happen for 2 reasons. One: this would require shifting capital towards households and away from the state. Translation: fewer opportunities for kickbacks and corruption for politicians/bureaucrats, and more power for entrepreneurs. Two: China is now the fastest aging society in history, with a population expected to cut in half by 2100. Most consumption takes place in the 25-49 age cohort, which will shrink drastically going forward.
Another interesting piece of info: in the US, if you invest in, say, a factory, but the factory goes bust, the loss is written down and subtracted from gdp statistics. In China, if said factory goes bust, the loss is not subtracted from GDP. This is often because bad loans are often rolled over into new loans rather than entered as a loss on the books. God only knows how much said accounting tricks factor in to China's GDP stats.
Real problem is caused by the usual "refusal to lose face". Entire county is lying to themselves. Contrived government sets GDP "goals" that cannot be met. Managers intentionally lie stating they have met that goal. In this artificial environment new goals (at higher rates or returns are then set) which are then also not met and then lied about. China is the result of a failed philosophy. The mountain thieves have stolen the entire civilization. They will keep on pushing the "big lie" and everyone buys into that lie. Soon to be a ghost civilization.
Those cities are being built for western specialists when the time of depression arrives the west.
Thank you, Going through her profile in her webpage, she smashed all her state certificate and accreditation
@@lezliewhicker8450I just look up her name online and found her webpage, thanks🙏
I heard she always have a way of linking someone investment into something new and profitable?
In 2016 I was in China. Between the city of Kaifeng and Zhengzhou, there were very large, completed apartment buildings that were sitting completely empty and they are surrounded by more construction projects to feels more apartment units.
The country just got completely addicted to building and speculating in real estate. In the future, this speculative bubble will probably be something as ridiculously large as the Dutch tulip bubble of 1624.
I have spent my working life trying to reduce material wastage in my landscaping company, I am so careful to recycle everything. If I dismantle a wall I clean the bricks and reuse them. If I leave half a bag of cement to go hard I feel guilty. Seeing this is heart breaking. No wonder we are running short of resources if this is how they are being used. There is not an infinite amount of building sand available.
Thank you. You're too right.
And soon this will be happening in the USA too, don't forget that the Democrats want the USA to become socialist (communists), what is happening in China happens because the socialist government meddles in people's lives and every generation of American children more and more they think that socialism is good...
@@ThetOLogrin This is incorrect.
Joe Biden is more right wing than Boris Johnson. He would be too right wing to be elected in Britain, same with Obama. We are a conservative country. The U.S Democrats do not support universal healthcare or state funded tertiary education. They are not Socialists in any way, even Bernie Sanders is a Social Democrat. They are Liberal Capitalists, the same as the Republicans.
Communism is Fascism, they are the same thing. The Chinese government is not Socialist, it is Fascist. They have no intention of handing power to working people ever. Just because they are called 'Communist' means nothing. North Korea is called Democratic. Words are cheap.
in the future it will all be recycled so dont worry too much...we are all but sand
@@deiselden Wrong kind of sand unfortunately, good concrete requires hard, jagged sand particles that retain strength. Biological organisms cook down to a mineral rich powder that is good for fertiliser but makes weak building material.
Adding fresh blood to concrete during mixing does make it much stronger but we need that when we are alive.
I visited a ghost city that was about an hour's drive north of Fuzhou in Fujian. The developers had built an entire water/amusement park to help market the city as a holiday destination. I revisited the same place about 5 years later and the apartment towers were still completely empty. A very small number of the villas were occupied, less than a dozen, the Waterpark was still closed and looked as if there has been no further construction on it since my previous visit. In fact, the only business I saw open was a single convenience store and the sales office. It was bewildering.
Was that in Change district, Fuzhou?
Is that the one proper people went to and explored?
@@stehenry5634 I believe it was called Jinzhou. Almost directly north of Fuzhou. It was about 8 years ago last time I was at that town. No idea the state of it now.
@@markvogel5872 proper people? What do you mean?
@@wadeh1031 they are an urban exploration youtube channel...they went to china and saw an old water park
I took an Uber ride the other day and my driver was from China. He was explaining to me how bad the government is and he could never go back and live there. I remembered all these videos I watched and just hearing it come out from a Chinese person made all this information even more eerie.
@ J D : If you ever _do_ meet someone who _does_ like the Chinese government and _would_ like to live there, you can give that person this good news : They _don't need_ to go all the way to China (about a 10,000 km, 14 hour flight from the U.S.) to experience the cavernous stupidity, iron-fisted authoritarianism and gross incompetence of the CCP government. All they have to do is *_vote Republican!_* See what I mean ? No need to suffer the cost and inconvenience of moving to China. They can get it right here in America once the donald trump Republican agenda has converted American government into a one-party dictatorship that merely has to _declare_ that they've _"won"_ every election.
But people look happy over there, maybe they pretend to be happy?
@@frv6610 Some look happy because they're oblivious to what is really happening. They are easily entertained by flashy things. We have a class of populace like those here in the US.
@@frv6610 ... they have facial recognition camera. If you have unfavorable opinions...points deducted and you get penalized... can't travel freely...etc.
@@stephenc2481 Face recog camera at my grocery store, to see if you're on their vacks records.
In the state I live in in the US, you're taxed or penalized if you let properties go vacant like this.
Cuz here you own nothing even if you pay for it.should be yours to do whatever. Noones entitled to something you own EXCEPT the government.
@@brysoncherry9884call blackrock so they can kick you to the street then dumbass
@@brysoncherry9884 And this video of China ghost towns shows what happens when you have the "freedom" to do whatever you want with your land, even if it's nothing at all.
After the fall of the Soviet Union, economists said that it wasn't so much that the Soviet Union was underdeveloped, as mis-developed. Capital invested in the wrong things. Von Mises said the problem with communism is that it cannot determine economic value. Market systems work by constantly assessing value through mass market transactions.
Perhaps that's why modern China is not communist. It's officially a mixed free market and socialist system under the oversight of CPC. Also known as socialism with Chinese characteristics.
@@brexitgreens It's a corrupt, authoritarian, dystopian nightmare.
@@brexitgreens
Only in terms of international trade, however; as China is forced to do so, if it wants to do business with other countries. Most Nations use a blended economic model. But China is still communist in the sense that they've elevated an outdated and failed western economic philosophy to the point of ideology.
@@brexitgreens Brexit: The CCP overrules market incentives and distorts market functioning. Only a fool would put money into Chinese investments. You will lose.
...and those mass market transactions are more or less free from state control and direction. When you overlay an ignorant, dogmatic, thuggish "socialism with Chinese characteristics" system on a market economy and market systems, that governmental heavy hand distorts and can destroy those markets and the people working within them. Modern China fears the "free hand" of the market because it saw itself losing power and control over its own people. Rather than partnering with the markets, it's now squashing those "enemy" markets to preserve those so-called "Chinese characteristics." For example, who cares if citizens can no longer get food, medication, health services for, say, cancer or kidneys or the heart, or if citizens commit suicide from being locked in, or if buildings burn down because firefighters can no longer do their work? That's fine. Another example: food. How is food getting to the people? How are farmers planting their crops when they are not allowed to get to their fields or harvest the food? Just so long as the authorities can log deaths in any column other than "COVID-19", it's a "win" for the state and a way to boast that "Chinese democracy" is the best "democracy" in the world. Question: Do Chinese citizens vote for local or national officials? Are there competing candidates who discuss the issues to try to persuade the people? Those are elements in a democracy, after all. It's the reapplication of the communist system that's strangling the country and now killing its people. But, of course China can declare that evil "foreign forces" (aka, the USA and its imperialist running dogs) are at work to undermine GREAT CHINA! Solution: War!
Just the amount of energy used for producing all of that concrete is mindblowing. What a waste of resources.
Concrete requires a specific type of sand to make that is also running out.
All that concrete wasted, plus the energy used in all the harvesting, transporting, and construction.
All for what? It's all just so goddamn wasteful.
And CO2 production.
Yes, and who has paid for it all?
That country looks beautiful, too bad the government has destroyed it.
That is how Communism works
@@oveidasinclair982
Indeed, that's why it sucks.
The people are equally as responsible.
The chinese nationalist are responsible for this ,they're brainwashed with ccp doctrines
@@oveidasinclair982 no offense but if you think this is communism you literally don't understand what communism is. This is like,,, even beyond post-capitalism. This is focusing on making money so much that nothing makes sense at all. Where everyone is trying to make enough money to pay their rent and also owns a cheap investment house hours away from any city...?
I like how it's only 13 minutes long but its content is a hundred times more clearer than any hour long videos out there.. Great work, I just found your channel and subbed immediately..
How can a property which is neglected in the middle of a ghost town - and therefore be subject to no maintenance or general upkeep - maintain or increase its value? As you highlighted in the video, these buildings are deteriorating rapidly to the point they're clearly not safe to be around, let alone live in. Any value that these properties may be worth will be lost in renovating the towns all over again due to dilapidation. Total false economy.
It's b.s. Tulip mania.
.
.
Some agenda 21 shit
You don't lose money until you sell at a loss. You can still take out a loan against your inflated property value. The bubble will of course burst, but not the way it would in a free market.
The Chinese have decided a war time economy is preferable to facing reality ....
It’s all filled up now
This is hands down the best video on the Chinese real estate problems on youtube. For starters, it contains original footage and the two individuals had the balls to travel all over China to get this footage.
A sad future lies aheah, faking video material like that gets easier and easier which will only make it easier for countries like China to rub all accusations off with "it's fake news!"
Damn I never realized how unbelievably speculative this was in China. Bubbles can be sustained for a given time, but eventually an investment has to be supported by it’s intrinsic worth. People paying hand over fist for empty concrete husks with nobody to live in them should send all the alarm bells ringing. It’s insane.
" eventually an investment has to be supported by it’s intrinsic worth." --- There is hardly a truism more true than this one. Why doesn't it happen? Easy answer.....government.
Spain did the same with EU money until 2009
It's not even speculative at that point, I think. It's more fictional, like a Bitcoin or non-fungible token, just with a more stable market value. With the low/non-existent population growth, there is clearly no realistic chance those apartments will ever be used.
Basically they could end up with a currency that is more significantly based in the theoretical real-estate value, rather than e.g. gold.
Great rundown. I learned a lot, and I've been following this peripherally for a while. I also appreciate your obvious sympathy for the average Chinese person. I've spent some time there- really wonderful people and culture that are caught in a very difficult situation. You made a complicated situation and country more understandable.
I used to love exploring these cities. Something about them that was so intriguing. At one point, I wanted to move to Ordos just to start a whole series about it. Kinda glad I didn't tbh, haha
Man like Colin
for house ordos!
The term "liminal space" comes to my mind when seeing so much empty buildings
@@SyntheticParanoia ooo true, have you ever seen the back rooms?
Ordos was featured in the first season of the CBS crime action TV show, “Person of Interest.”
When I was in the Navy, my ship, the Lassen, sailed up the Yangtze to shanghai. I was lucky enough to be on a guided tour of Beijing(after customs questioned how 20 US military members got into the country without showing passports). The entire trip I was noticing MASSIVE construction projects. It became clear the nearby buildings were empty and yet they were still building more. That was 2008. The US was having a housing bubble issue, but China looked like their entire economy was based on a bubble vastly greater. God forbid that bubble burst because if it does, the dominos will ALL start falling.
Sadly, its not if but when.
My Dad sailed out of Pusan harbor, under fire, in 1950. His was the first American flagged ship to sail inland since commie takeover. Last until Nixons crew opened trade. They were ordered to Beijing. Merchant Marine with Navy V12 training.
Chees Mate
Ain't the bubble already popped?
Let's hope they do
Domino will not start falling. We might see price drop of real estate in the western world but not total collapse China is facing. Simply because real estate there has value with purpose to generate income or some form of value. In China the only purpose of most of real estate is to be built to drive construction GDP up and to be sold to drive real estate sector GDP up. Regardless of whether someone lives there, rents there or if it still stays 10 years later. This is simply not how it works in western world which is why real estate here will keep atleast 80% of its current value. In China it could be easily like 5% with their income to price ratio and the fact that most of those buildings are already falling apart and will soon not exist.
Very well explained! They have purchase property in Vancouver, Canada - there are huge houses sitting empty, destroyed by vandals, and have had a major impact for many years on housing prices here.
Do you mean Chinese have purchased property in Canada?
Because if so, they are you doing it here in New Zealand too and it is driving our housing market up to a point where us NZers can't afford to buy houses!
Our people kicked up a stink and the government put small restrictions on their purchases but don't stop it because all governments are selfish
@@Mr_C.Bacteria Yes - I am talking specifically about Vancouver, British Columbia. Until I watched this video I did not understand why they would buy multi-million $ properties and leave them vacant and rotting; not caring what happens to them. We have a vacant house tax here now but it doesn't seem to make any difference.
People with such a warped way of doing things should not have been let in in the first place. Governments can try to fix the problems AFTER letting immigrants easily in but it's like waiting to defend your castle until AFTER the invading army has breached the walls.
It’s like that here in Alberta,sometimes I wish they stayed on their own side of the ocean
@@dwight4626 The problem is not those immigrating - it is investors that have no intension of coming to live here. I wish there were laws in place to protect the market from foreign investors.
A few years ago my daughter and I rode our scooters away from Guangzhou to see what we would see, after about 20 minutes we drove into a small town that was completely empty and deserted. It wasn’t big like what you are showing, but it was empty and obviously had been for a while. Like an old west ghost town. There were a couple people walking around, but 99% of the place was deserted. My daughter (21) said she was scared and we should turn around, We did and did not stray far from tourist areas after that.
Imagine all the homeless these empty cities could house.
@@kentclark6420 Not even useful for the homeless. How would you provide them the services they need? No markets, no food, no hot water, electricity, is basically like living on a cave apart from civilisation without any means of transport (even worse, as caves at least protect you from the bad weather, these are all unfinished).
@@acouvers Food can be grown and water can be heated with a simple fire.
Your daughter has good instincts! God bless her!
So the only way to keep this bubble going, is by sufficiently high economic growth, i.e. inflation. Or alternatively, they could reduce the rate at which they construct, and stabilize their currency based on the fictional value of these appartements. The government has to take a middle path with reasonable inflation, where they keep construction rate low enough, so the fictional value is maintained reasonably, while constructing enough to keep the market happy and construction companies alive.
This was really interesting, I travelled through China by car and I was stunned by the gigantic empty buildings everywhere and more going up, not to mention all the empty houses. It was mind boggling. Now I understand better.
Hi! I would love to travel by car through China. I wonder what can you find between cities? In my head there are lots of 10 million people cities separated by hundreds of kilometers of nothing. Is it like that? What can you find outside the cities?
@@PP-sj7pl I did not travel through the whole of chine just the parts between the cities where I worked so like 3 to 4 hour drives each time, there was very little country side, just never ending houses with no lights and manicured vegetation along the high ways, you feel that there are more than a billion people living there, lots of small farms with ducks, it was depressing. train stations in small towns on an absolutely huge scale..........I should have documented it........
I think there's a huge fully functioning airport out there somewhere that's completely deserted, but still "open" with one poor shop keeper in it. I remember seeing that video a couple of years ago.
"Real estate has never gone down." That's also what we said here in the US in 2007. Then in places like inland CA and NV and AZ prices fell 60%. In some places they have only now returned to their pre-crash levels.
you know what that means!
@@ppstorm_ it means they will pump the balloon a bit more then pop it.
"returned to their pre-crash levels"... so its not gone down then has it..... and it will go up further. its only a matter of waiting a few years
@@jimmytenname2451 No. You have to account for the time value of money. It has recovered in NOMINAL terms, not REAL terms. That's a horrible investment.
That is EXACTLY what should happen. Housing prices are way too expensive for anyone except those rich mfs to afford.
The amount of debt and sheer waste is mind boggling.
China is doing what the US is doing. Printing money . Worthless paper.
It makes absolutely no sense & defies all investment principles. It cannot sustain. It's the classic ponzi scheme. Once the buying stops, the whole thing falls apart. It will crash here in the next decade or so when their population falls by a third due to their 30 year one child policy.
@@leskobrandon691 They stopped the one child policy a while ago. But since they only wanted boys at that time there is a severe shortage of women.
Lol…this isn’t a waste it’s a long term strategy that hasn’t been revealed yet
“ Amount of debt and sheer waste “ is anOTHER product of communist atrocious control and social-economic boggle.
I'm amazed at how good you are at connecting all the economic, political, cultural, and historical dots and presenting the situation as it is in practical terms. Really good work! :D
Why would you invest in something you will never sell? Who buys an apartment in a ghost city? This will clearly collapse very soon. I don't think video explains this very well.
Good at connecting the dots? Did you get the part that a multimillion dollars estate in Shenzen can actually be rented as housing by middle class people? And they do not need to have 3 jobs to afford that?
These ghost cities have been built strategically in advance by the Chinese government before the stockmarket crash and coming global reset. China is building all this infrastructure and condos, houses to make housing more affordable, more accessible for their population as China transitions into the computer information, A.I., robotics time period. These future cities will be business an tech hubs, prebuilt housing for future workers, and allow China to grow exponentially. When the recession an reset happen, their recovery will be quicker, and they wont have spend decades building these cities during potentially down times, they can furnish these ghost cities much cheaper an easier than if they didn’t build them heading into a recession, and resetting the financial system, then it would be crazy expensive to slowly build this infrastructure later on. Ghost cities will get populated quickly over the next 10-20 years.
@@Matt-zp1jn china been playing the long game
@@Matt-zp1jn china been playing the long game
imagine buying a deteriorating prison cell and calling it both an “investment” and a “home”
We lived through the land/apartment bubble in Taiwan in the 80's and 90's. It was awful- but not as bad or corrupt as the current mess in the Mainland. We rented a super nice, new, townhouse in metro Taipei in 1991 that was valued at $650,000 US and we were paying $635 per month in rent. That was completely furnished with Italian marble floors, custom lighting and all solid hard wood cabinetry!
That is called living the good life my man 😁Kudos👍🏿
you were living the dream!
What a steal - rent 635 for 650k house?! Wow so interesting.. I bet there was some tax exemption loophole, otherwise I dont see economic gain from renting it.
Fucking incredible!
Only a hundred years to pay it off!
When I lived in Singapore, and a Chinese person moved into our condominium, I noticed that they removed every nice thing from their unit, including the beautiful marble flooring. They just tore it out in unusable chunks. I thought that was such a waste. America would totally recycle that.
They prob didn't know
Why?
He says in the video. Dont want to take on last persons bad juju.
I remember seeing these massive Sim City like developments going up everywhere over 10 and 20 years ago. I thought then that the real estate market would have to correct but still today there’s been no reckoning. I imagine the problem has only gotten worse and I remain confused by how it continues. This was a good video.
corruption.
Evergrande was the first visible crack but has seemingly been kicked down the road yet further.
Edit: I got curious and it seems another large developer, Sunac, just missed a major payment. My guess is that the government will do everything it can to let it collapse in slow motion and use it as an opportunity to exert more state control as they have in the tech and education sectors.
Don’t worry, I don’t know how there hasn’t been a reckoning either. I can only think that it must be the result of… well I would say corrupt but it goes deeper than that. The whole system was built to rot, out of rotting materials without ever being built to actually function.
I don’t even know how the Chinese people and the CCP could fix it. The situation is totally illogical and I don’t understand how it was allowed to happen. But I know one thing without a doubt. If and when the Chinese real estate market does collapse the people that suffer won’t be the officials and higher ups in these corrupt real estate and building companies, it’ll be the common folk. Most likely the poorest people at the bottom of the housing ladder who can least afford it.
But yeah if it was a country that didn’t have a horrifically brutal, evil and monstrous authoritarian regime as a government and I wanted to make a movie set during or after an apocalypse then one of those ghost cities would be almost ideal to film it in.
I hope I'm alive to see the correction, because it's going to be spectacular.
@@generalmartok3990 BlackRock, where is it heading I wonder?
One thing that should be noted: the Chinese government does meddle with real estate. In some big cities, good secondary schools used to require you to live in a certain area for you to be able to attend them, which in turn allowed the properties in those areas to be profitable investments. The government stepped in and not only removed the requirements, but also started to randomly assign schools for students, making a lot of properties lose their value and become undesirable. Another example is that the government has also started to cap the amount a property can go for on the market, and in some cases can reduce its value to 1/2 of what it was. The Chinese real estate market is no longer a reliable form of investment for the majority of people, clearly indicated by the current market saturated with housing for sale (and no one to buy them).
That's probably why they are buying property here in the U.S. and Canada and our government is opening the door.
Which is, sort of good?
Edit: housing as investment is a massive problem if you want people to have stable housing.
The school thing actually seems like a good idea since that way you don't end up with a situation where only rich kids gets the best education.
Here's some more details: a lot of people who currently own housing bought their homes before the housing market expanded (~6 or 7 years ago I think), so many of them are the lower middle class who had just enough to purchase a home then. Most properties are also not solely for investment-the avg person doesn't have much money to buy extra homes-and are the exact same homes they live in.
Now let's say you want to improve your living conditions, you really can't. Current prices for homes are still too high and you can't even liquidate your old home. Wanna move to another city to get better jobs? You can't. If you're lucky, one of those residential development companies will decide to tear down your apartment building and build a new one. You can take the cash compensation or pay a little extra to live in the new building that may or may not be completed. Oh and the compensation is sometimes not enough to buy a new place to live either.
But it will be enough to pay the rent for one year on some ramshackle
no-plumbing hovel you have to share with your in-laws. Just try to find a job that pays similar wages as the one you lost.
Finland used to have a reverse problem, because every young person flocked to big cities, rural housing went so cheap some houses were sold for 1 Euro and banks granted negative interest rate mortgages, meaning you actually pay back less than you originally loaned. Coronavirus put a stop to that when it caused a city flight, now our housing market is balanced. I've read that Mongolia and Japan had a similar problem with demographics too.
Yeah, I live in Japan and it's the same. You can get houses for pretty much free. However they are like 50 years old and being swallowed by vegetation. Most people would probably find a tent preferable lol not to mention you are a 30 minute drive from even a small store and probably an hour or more for anything that resembles a modern one and you of course have to live in them as part of the deal. I love carpentry and would love to have one as a fix me up project on long weekends and use as a villa but they want you to live there and help out the local economy/population.
@@makokx7063 the government will need to loosen up on those regulations. In Alaska, you can still get homesteads basically for free and you don't have to live on them full time.
@@bagofpennys7457 I doubt anything is going to change. Japan's birthrate is something like 1.3 so they already are running out of people. No incentive to get them to relocate outside of the Tokyo and Osaka areas.
As an American though I would love to get an Alaskan summer home lol
Fuck bro, why didn't you tell me? We're paying over a million dollars for homes here in Canada wtf
I am Japanese. Sorry, my English is not good. You cannot get a house for free. If you are in the countryside, you can buy a house cheaply with city assistance. In general, except in the city center, it is possible to buy a house normally. You work normally and buy normally.
This is very prescient considering this was released 1 yr ago. I love your show because you’ve lived there, still know people who struggle through life under the CCP, and you’ve been all over the interior. Who better to give us the real inside stories? Just awesome! ❤️😊
In some ways it is like a reality world version of an NFT.
Edit: I would like to introduce a new term. "Ghost city" as originally coming from "Ghost towns (America)" should really only apply to places that were once alive with people but "died" as the people left for one reason or another. Given that these cities were never alive in the first place, then the correct term should be "Stillborn Cities" or whatever the Chinese word for this is. They were born already dead. 😬
Miscarried cities.
Lmaooo stillborn cities. Maybe aborted cities.
"industrially aborted cities" as there was no intent to see them alive anyway?
Ectopic cities.
I thought the same thing, or close enough. Rather I thought it like bitcoin, or tulip bulbs, or shares (very pretty paper too) of the South Seas Corporation. But given many layers of financial derivatives in the markets, the real estate valuation, while unimaginably stratospheric, is just the tip of a hyper-derivative-ized bubble of counter-partied "moral hazard" "contracts" of some fabled monetary value. When it drys, it may hyper-dry, and all the cohesiveness of one people becomes like the cohesiveness of the Gobi sands in the dry and windy season.
A relative who travels to China tells me that if you don't see electric Heating Ventilation and Air-Conditioning units on the exterior walls, then it is very likely to be unoccupied.
That's very logical.
Yes, the occupancy of a condominium complex can be told simply by the number of AC units which can be seen from outside.
That’s next level thinking for my smooth brain
smart.
Crazy to not even have Heating in a hi rise. Why even have a roof and windows if usability don't matter? Guess China gdp will stall at $10,000 per person forever, at least Japan got to $40,000, that's why China shouldn't brag they are stallong out so low I feel bad. The top 1% running factories or govt stole $20m of wealth net last 20 years or $1m yearly , if given to 99% workers that's $10,000 per worker ($1,000,000/100) the worker didn't have but should've got yearly so extra poverty for them due to corrupt system not paying hardest workers on planet ... Darn commies...
Near zhuhai there is a massive complex of ghost luxury villas. Really fancy villas that are overgrown with tropical grass and wild dogs. Is a crazy sight to see.
im sure they look fancy on the outside but ready to fall apart when someone steps inside
Yeah i absolutely
I loving it babes
@@jontyrhodes4155 a Chinese national trying to create an American sounding name will always get me
@@ssslugn hey sluggie boy .....
ive explored in china before, but everything inside has the furniture and etc, really big waste of money and all of it are going to rot
Thank you for this research! It explains a great deal!
As a child or teen I would have loved to secretly explore such empty buildings.
Dangerous no cap 😆
Its China.
You would probably be taken. As a child and especially if a foreigner.
Even better
They look like a backrooms level
way more dangerous than the ruins waledk which are Victorian - I don't have to worry about tofu dreg flooring collapsing
Twenty years ago, as a kid, I thought
"Hmm, China is probably trying to provide more homes for it's big population. That makes sense"
It's only recently that I understood what's going on with those cities.
If they gave the housing to the poor, at least it would had an social function. But they made them in middle of nowhere, not where there is actual demand (beijing and other big cities), to try to not crash the prices by overbuilding. Begs the question what will be made of it, once the inevitable finally happens.
The China population will not be half of what it is in 20 to 30 years. Already more than half the population is older than 40 and childbearing aged couples are choosing not to have children with a dystopian future. It isn't just the West with this problem.
@@AdlerMow as if someone was patrolling all these buildings, your probably more safe under a rock though
That is due to capitalism. You're correct in that if these massive cities were built with socialist ideals, it would make sense. But capitalism only cares about one thing only, the bottom line.
Thank you for bringing up this observation comrade.
@@vonschweringen8321 Odd how when state action has bad consequences, capitalism is somehow the fall guy.
This was a phenomenally well-written piece of journalism. I’ve never heard this topic broken down into such a clear and informative way. It’s all just so damned... crazy... that this is why all of these ghost cities exist in China.
yes, that was interesting, I'd never heard of that either
Why haven't we?
Complicit
@@brianlandi6920 Wow your comment is pretty negative! I don't think the OP was particularly criticizing China, he was just giving info most of us didn't know. You seem to be a little sensitive on a subject no one said anything negative about. Why wouldn't we like that China has made advancement bringing people out of poverty? Just the fact that you feel the need to justify it makes it look like it's not as positive as you'd like to make it sound..
@@Addwater4444 This video is a pure propaganda piece...
@@nusproizvodjach That must be the greatest fake footage of all time then...
This old vid is more useful than current trending content out there. Thank you!
I went to Weihai about 12 years ago, to do some tourist stuff, and to meet a gal that I was a pen-pal with. We went to the Sino-Japanese War Museum on Liugong Island. It was pretty interesting, and people were mostly nice. I went around the city a bit, and there were these huge apartment buildings everywhere, but I never saw many people around them. In the day it was pretty busy in the city. Some Russians on the beach. It was a challenge to get across the streets without getting run over. At night it was like a ghost town. I saw clubs advertised, but if I went there, they were always gone, or closed. I had a cab driver drive me around in the evening and there was nothing going on that I could see.
So basically no-one slept/lived in that area, they were only there for daytime activities
The Weihai is pretty boring area and still is. You have to go nearby Qingdao it’s more fun. You got only the good seafood and good university there and nothing else in Weihai. A lot of rich Koreans go there to date or try to marry the pretty tall Shandong gals but a lot of them already left for the Tier 1 cities.
Old CCP saying goes "Its very dark in the evening"
@@hue9962 i live in qingdao and even though in the day time its busy, in the night time its dead. i think its a trademark of shandong province.
@@PhillipGregoryMusic yeah maybe the weekend it was there pre Covid it was more lively. Now probably everything has changed
I really miss you two taking those tours around China, but I'd rather see you both safe and away from their tyranny. Thank you for all your years of dedication.
？
wtf ? u come china for what ? spy or something ?
@@夏顾原 动态网自由门 天安門 天安门 法輪功 李洪志 Free Tibet 六四天安門事件 The Tiananmen Square protests of 1989 天安門大屠殺 The Tiananmen Square Massacre 反右派鬥爭 The Anti-Rightist Struggle 大躍進政策 The Great Leap Forward 文化大革命 The Great Proletarian Cultural Revolution 人權 Human Rights 民運 Democratization 自由 Freedom 獨立 Independence 多黨制 Multi-party system 台灣 臺灣 Taiwan Formosa 中華民國 Republic of China 西藏 土伯特 唐古特 Tibet 達賴喇嘛 Dalai Lama 法輪功 Falun Dafa 新疆維吾爾自治區 The Xinjiang Uyghur Autonomous Region 諾貝爾和平獎 Nobel Peace Prize 劉暁波 Liu Xiaobo 民主 言論 思想 反共 反革命 抗議 運動 騷亂 暴亂 騷擾 擾亂 抗暴 平反 維權 示威游行 李洪志 法輪大法 大法弟子 強制斷種 強制堕胎 民族淨化 人體實驗 肅清 胡耀邦 趙紫陽 魏京生 王丹 還政於民 和平演變 激流中國 北京之春 大紀元時報 九評論共産黨 獨裁 專制 壓制 統一 監視 鎮壓 迫害 侵略 掠奪 破壞 拷問 屠殺 活摘器官 誘拐 買賣人口 遊進 走私 毒品 賣淫 春畫 賭博 六合彩 天安門 天安门 法輪功 李洪志 Winnie the Pooh 劉曉波动态网自由门
Biceps over tortillas bro...
@@karkkimarkkinat2109 From your lips to God's ears, brother.
I know you explained the whole thing with value and culture...but I still cannot wrap my head around such waste and debt! The borrower is slave to the lender
And since in a system built on debt practically guarantees that the issuer will never recover the loan from the borrower because it's a pyramid scheme, that one day it must all come crashing down.
I doubt the Chinese government could guarantee the loans in the event of a meltdown. Instead, it will instantly nationalize theses properties to avoid that. And the poor fools who bought the "King of Debt" apartments will be wiped out.
Depression, poverty, starvation, collapse of China. Only the "government" will survive. It owns US gov't. bonds.
Lol you just explained it.
Indentured servitude
And actually it's the trick by some local governments to boost their local GDP
Commies are Fakes, Frauds, and Phonies…. Everything they do…. Period
When I was living in China, there were a couple of big scandals where people invested in apartments, and couldn’t sell it for a profit. They sued saying the company GUARANTEED they would make a profit.
We visited China before Covid.
As we moved around the country all we could see was half built cities marching off into the horizon everywhere.
We came to the conclusion that there was a fortune to be made manufacturing high rise cranes.
You basically foreshadowed the collapse that’s happening now with this video. All these other TH-camrs are doing superficial research and saying the same things….. But here you are with boots on the ground footage. You are definitely a gem on this platform.
One wrong point: NOT "to store all this wealth" - BUT "to store all this DEBT"...
No difference. Money is debt.
_Real_ wealth is availability of goods and services.
@@cyrusol *Currency* is debt. _Money_ specie is wealth. Availability of goods and services is an economy. Even specie money is worthless if there is no semblance of an economy.
Debt for a poor man is the rich man's wealth
@@cyrusol most people don’t understand that the current fiat system is based in debt.
Exactly! It's not wealth
What a wonderful world we live in. I find these cities to be awe-inspiring and beautiful.
Perhaps the massive influx of android-citizen creation in the coming decades will help to populate these buildings.
I remember when me and my family were driving between the big cities in China like Beijing, Tianjin and so on, when we were driving along the highway, we would always see these random clumps of apartment buildings in the middle of nowhere next to the highway with nothing but mountains and grass around them with nobody living inside them
It was somewhat creepy to look at and I've always wondered why those buildings were there, big thanks for you talking about this topic!
You can go over there later and see full of people there. Beijing is different from all the other cities in this video and you will find out every one live in Beijing trying to buy a apartment around Beijing no matter how far away from the centre
It could be emergency evacuation buildings, housing for soldiers, experiment/test buildings to learn mistakes before building for real etc.
@@frv6610 In your dreams.....
@@brianlandi6920 You really think people are that stupid? He is showing you all the empty buildings that are falling apart because they haven't been maintained and yet they clearly are not being worked on now and haven't been touched in years. We are not blind. Take your CCP propaganda elsewhere. Here we think freely. China is a fantastically interesting culture and people trapped by a horrible government.
@@brianlandi6920 This guy was just showing you the physical FACTS. Difficult to make a positive case for so many shells of cities everywhere. If it works for China, that's great. They are playing the long game but it appears they may also be playing with fire if things don't improve. Evergrande has lost approximately 90% of its stock value (S1.40 in June 21 and now $0.14 in June 22).
Visited a strange little ghost town outside Shanghai. Based on a quiet English village with Harry Potter statues randomly about. Was mainly used for couples having wedding photos. This was back in 2012
Edit: Thames Town
The most disgusting thing to me about seeing these ghost cities is thinking of how the resources could have been used to better people’s lives, ie in other poorer nations that really could use basic shelter, or any other number of various things. Even a small percentage of the raw resource sharing would have made a far more positive impact elsewhere.
It is not China's responsibility to worry about their poorer nations. Other nations must handle their own problems. I come from one such nation and the issue lies with our politicians and corruption. Even if China were to send all the money, nothing would be accomplished for these countries. Furthermore, China, like other countries, has its own people to take care of
Not just other nations, poorer regions within China
who do you think paid people that build those buildings?
Communism
China got ghost cities and a dishonest government that's manned by corrupt communists.
While US has a homeless population crisis, and dishonest government that's manned by corrupt businessmen.
The amount of highly leveraged debt that has been used to prop up the chinese real estate market is insane. The fact that it has taken this long to unwind, simply shows how catastrophic its collapse will be. This bubble could decimate the entire global economy once it pops.
I spent many, many hours driving through open country in China from 2005-2008 for business. I traveled routinely between Shanghai and Ningbo long before the massive bridge project. I remember traveling with my colleague in a station wagon with a driver that spoke no English down endless new highways with scarcely a soul on them. Highways transecting it only going out a kilometer or less before ending in dirt. On the horizon I was struck by the multiple building complexes springing on the horizon like Asian Emerald cities. Most it seemed were three towers or five towers, but never four. I was told it sounds too much like "death" which was kinda prophetic. As the sun went down and after 3 hours of our driver relentlessly honking the horn for no real reason I noticed something. As the light faded not one of the high rises had lights on except often what looked like one apt on the ground floor. These were empty. Seemingly thousands of apts and condos in total darkness. The ghost cities were already well on their way. Thanks Serpentza for your insight. The China I remember from those years is not the China of now. I have lost friends who see me now as a nuisance and part of a decadent society. In retrospect in general we were played in business with the false sense of being a "partner" or "good cooperation" as they liked to say. Only as long as we filled their coiffeurs with money. I had an ex friend during the COVID pandemic tell me we in the US deserved the deaths we were recording because we did not follow the sound practices of China and that the didn't really care what happened to us. I responded, "that's sad because unlike you i do care what happens to the friends I made in China.
Hubris. Pride comes before a fall.
The drive sounds Amazing.
They were never friends
@@thedownunderverse Well what's the point in being friends with an American businessman if not for the money?
@@Iceberg_Farigamu friendship should not be based on a person's employment status or income.
That's gold digger talk right there
this is by far THE BEST VIDEO EVER that I have seen on the Internet that explains so well the reasons behind tha madness of the chinese housing market. economists cannot understand the superstition of the average Chinese and such a huge difference between a rent and a monthly mortgage installments.
They've had other videos on this before Covid, but it hadn't started to collapse. Laowhy or C-Milk had an episode where he complained about ever buying a junk apartment that started falling apart the 1st week.
I mentioned these ghost cities to coworkers and friends...they looked at me like I needed a tin hat. Sometimes I feel like Cassandra cursed to never be believed.
Science fact: humanity is dumb. Contrary to the psychiatric cult dogma, the majority is mentally defective. Sanity is abnormal.
Been doing it for years,nobody knows because nobody is interested in what makes the worlds clock tick.
Most people go through life with their heads stuck up their asses, totally oblivious to the world around them, it really amazes the shit out of me the complete ignorance.
Well I was surprised to have an Ugandan Uber driver who knew of and watches serpentza and laowhy86 and ADV China, too. So there are people in the world who are tuned into these guys and understand that what they're saying is for real.
Dont bother man, most people just live in their bubbles.
I most of the time head stories about china needing these apartments for future growth and that they are planing far ahead. This however is a way more reasonable explanation.
Thanks for the insight.
Indians have a saying "andher nagri chowpat raja" means "a city of darkness, [ruled by] a crazy king." That's China and CCP.
Just outside of Beijing (about 1 hr SW by train) I saw high rises from horizon to horizon, all identical. The thing is I didn't see more than a few cars. A near total lack of AC units in the windows was indicative of unoccupied buildings. I was told by a local that part of it was there was a big investment push to get average people to buy into these projects as investments. The problem is it turned out the units were too expensive for the avg person so it crashed.
I was joking that China's state bird is the tower crane.
The tower crane. I like that.
This is 100% accurate. I had visited Suzhou outside Shanghai some years ago and saw one such ghost city. There were trees growing out of the walls of some empty flats. Those buildings are never going to be inhabitable and must eventually be demolished. Most of all, I feel sorry for the ordinary Chinese citizen.
feel sorry for yourself, living in a mouldy council flat in the UK 😂😂😂😂
How can you explain that the Chinese keep paying for these flats when they know in 10 years or 20 they will be worthless? This is what I do not understand.
One example of corrupted power. A similar situation exists in other countries, particularly the USA, in building up their military far beyond what’s needed just to keep the armaments industry happy.
They will be fine. Not finishing them off is smart as that would deteriorate. Concrete will be fine, and when the time comes, they will be finished and sold off.
@@romanjimenezgil I guess they just plan to sell them and make a bit of profit before they become worthless. Or maybe just by owning them, and thus having an asset of some sort, they're more able to borrow money to purchase additional property which is a better investment. I don't know exactly how it works in China though, as I've heard mortgages are very uncommon in China, and most property buyers pay the full price up front.
Thank you for your explanation for why these apartments are left unfurnished. That makes a lot of sense.
Culturally, it seems there seems to be something related to new construction versus ongoing upkeep in China.
Please let me explain: In 2013 I visited China and visited a new science and technology museum in Guangzhou. From a distance it looked spectacular! It was full of interesting, hands-on exhibits. However, the museum was only a few years old, but about half of the hands-on exhibits were broken. The museum atrium was leaking water from the roof in several areas. In contrast to this, in a 2016 trip to Japan, Tokyo is not nearly as new as the construction in China, however the airport seems to be very well maintained and very efficient. There seems to be some kind of desire for new flashy buildings but then when the buildings get constructed there seems to be little desire to upkeep them. Has anyone else noticed this in China?
India had this phase back between 2005 to 2015. There were massive defaults then by construction companies, and the market started giving crazy awesome returns, so the last few years has only seen genuine home buyers buying up houses, and nobody takes them for investment anymore. Our ghost city phase is over and was not even a few % as big as this nonsense.
Thanks for the vid !
This is the purpose of free market forces. To keep you from doing too much stupid sh**. This is why govts need to stay out of bailouts as far as possible. It is one thing to step in to ease the pain or bring about a managed collapse. Another to hold back corrective forces entirely. It would be like you have a hairline fracture in your foot, but instead of dealing with the inconvenience of staying home and missing out on stuff, you take painkillers and keep on keeping on, all the time making your underlying problem worse. Then all of a sudden, the hairline fracture gives way completely - and then you blame America. 🙄
Companies like Unitech, JayPee, Supertech, Amrapali etc ( most promoters being erstwhile local goons) went on land buying spree and started projects after projects and also siphoned money for personal gains. Now they are bankrupt. Unlike China, India has buyers who wants to live in the apartments they buy. Of course there will be investors.
Alas these builders duped many home buyers. Maybe these Chinese companies could have built apartments here (provided they maintain the quality. I remember a video by Serpentza where he talked about the shitty construction standards in China).
Where? Which city?
Interesting! What happened to the ghost cities in India? Are they now populated? Can't seem to work with what I see in this video, I doubt they did any basic electrical, freshwater, drainage, infrastructure (and so on) work there. That's nearly impossible to build all afterwards
@@luke1811 I myself live in a 'Ghost city', which is to say this place was very well developed but didn't see people for a long time. But come Covid, these places are now exploding in popularity. Thie difference is in India, there's so much demand for infra, that demand always precedes supply. SO,, there still indeed are empty buildings, but given time, population should arrive.
When I visited China 5 years ago the ghost cities were something I will never forget. It felt like I was witnessing the apocalypse. Driving into Xian it felt like the empty towers would never end.
I've actually seen this 'ghost town' on my trip in Hainan, I remember there's a lot of apartment tower all lining up like 5 of them and they're all empty. It's really an eerie feeling especially at night
Ha! When we were in Sanya in 2013, we thought all these newly constructed buildings would be hotels.
It’s so bizarre. If you don’t have people living in these structures, there will be no one to maintain them and they will eventually fall down, but not before making a terribly awful blighted sight. How do I know this? I grew up near Detroit and I saw how fast a whole city can fall apart when no one lives in the homes or conducts business in the commercial buildings. So when I say this is bizarre I mean to me I can’t fathom why you would build a Detroit, but skip the part where it is thriving place full of people and opportunity and just skip right to the part where it is empty and about to fall apart.
In the civilised world where people's Safety was paramount, these dodgy built stains on the landscape would be condemned.
and Detroit was a beautiful city when it was thriving. A lot of the architecture that is falling apart was exquisite. Detroit and the ghost cities are the result of corrupt and putrid governments. I hope Detroit can one day have an honest government so the people there can live in peace and prosperity.
One of the greatest tricks of the past 120 years was convincing man that living in crowded cities was better than owning rural land in the countryside.
If you can somehow isolate a man from his natural enviroment which is nature, you have control on him. He simply becomes your slave who's living adapted to your rules. That's how western commercial propaganda works.
Naive man full of dreams is realising direct message which is, "Move to a urban populated cities, work hard, get a credit from a bank, buy house and car, achive your material dreams and have a good life", but he doesn't realise subliminal message which is, "You'll paying back your credit to the rest of your life, we'll force you to work hard for us and our economic system, you'll become our slave and we'll take from you even more through paying taxes, you will suffer, be unhappy, sick, and we'll selling you a toxic medicaments to make you even more sick and keep draining money from your wallet you're gonna krrp spending over and over on medicaments".
Only a smart man who's aware all of these things and how actually entire system works in general can live in a city, have a smart way of living and keep himself of falling into a death trap I mentioned above. Only this kind of man can do a lot of things in his life, have a success and be free while others around him are stucked in isolated carantine of slavery exploatation. When a man is aware, he's not gonna do one single wrong step. He came to a city seeking success, not to become a slave. His path will be extremely hard, but everything is possible, one man can outsmart entire system if he's smart and dedicated enough.
Ps. Let's think a bit together: Do we really need to have something expensive, for example, the latest iPhone, devil's cloth (balenciaga), rings with diamonds, Mercedes car and things like that? My real question is: Can we have a normal life without all of these sick trands as social deviations?
If your answer is YES, than you're free, not a blinded slave to a capitalistic-consument infrastrastructure system for exploating man into a hard working and producing machine.
so true
This is a helluva statement... especially since cities are MUCH older than 120 years.
There is nothing wrong with living in a well-regulated and maintainted society. There are many countries the world over who have cities that are beneficial to the people who live in them for a variety of reasons.
You wanna go live on a farm? Great, go do it.
Stop pretending like it's a better option for everybody. It's not.
Amen, sibling
Probably because of the invention of electricity, phones, and then the Internet, all of which were only available in cities originally. Also, well-designed cities have quick access to almost every service, e.g. stores and schools are often at a walking distance. And yes, I definitely believe cities are better places to live in general, though I'd rather live closer to the edge to avoid exposure to excess pollution.
Imagine in a thousand years archaeologists discover these sprawling cities of unfinished buildings and are just totally stumped.
I was just thinking that. In all the years of watching Star Trek (original) I don't recall any episode where they met something like encountering a -dead- stillborn city that had never been lived in.
Nonsense. Assuming that books and internet survive they won't be stumped at all
Bro these buildings wont last 100 years you think they will make it thousands of years ?
They definitely wont stand a thousand years.
Keenan Larson,
PRC construction is so bad, those skyscrapers won't stand up for ten years.
You guys provide so much valuable information. Many years ago I heard about ghost cities and attempted to find out more about these as I invest in the market. It wasn't until I stumbled upon this actual video did I find any valuable information. You guys provide high quality content. China housing market dwarfs the US 2008 housing crisis. Hold on when this falls apart. Stay awesome and safe.
The "imminent" collapse has been announced by Western experts for years. Including by @SerpentZA.
@@brexitgreens Yeah it will eventually collapse but the government must get out of the way.
What’s going on in China is 100 fold worse than in the US.
Thats why they cannot ever go back to China
It is better to discover than stumble.
You will injure yourself when you are not mentally grounded
I first heard about ghost cities on 60 minutes several years ago. They did a story about people who were fighting the government to protect their homes from being destroyed to make room for a city no one would live in. They lost.
A squished wide pancake with large columns on the outside.
1:50 We have this same building concept in Bulgaria. Palace of Sports, Varna.
I remember back in 2008 before the Olympics and the housing prices went up a lot. Everyone and their grandmothers built 4 brick walls with a roof in hope of selling it off and make a fortune. At that time I was up in Hami in Xinjiang and villages were surrounded by these hollow brick boxes. Still today I sometimes wonder how many of them actually got sold.
As the government builds more infrastructure they buy these properties from the owners. Sure, they just get torn down to make way for roads, trains or buildings but that’s why people build on their properties.
To invest in a largely unlivable depreciating real estate asset is truly the definition of insanity. Once the reality of this sets in that's it regardless of the CCP.
On top of that, the building codes are horrendous, so many of these ghost cities are already crumbling.
Ponzi schemes can only work for so long, and this one is already starting to collapse.
I disagree, prices will crash and some will be ruined, but the government will bail out key players, a recession will occur and the Chinese GDP will shrink slightly for the first time in many years. Western countries have had shrinking GDPs and survived
Waitingforrealitytosetin
Real estate does NOT have a Life.
Thus it is neither livable nor unlivable.
However it can be > habitable or inhabitable
Undertake an extensive reading program to better educate yourself
and improve your knowledge of the English language and literacy
You can do it. - Start immediately and invest in yourself
Good luck and good bye
@@andrew_koala2974 It's actually inhabitable or uninhabitable. You should check your own knowledge of English before giving lessons to others.
No country can withstand such an epic misappropriation of capital. Imagine letting the market put the capital to better use.
only a "capitalist" would say that!
@@Hank520Tube Thank you 🙂
They're even crazier than we are..
These ghost cities are gonna be SO MUCH fun to parkour on. I'd also imagine it is very easy to get away with murder there
The empty houses are one thing, but seeing those plazas and water fountains just sit there makes it even more sad.
Who knew that some intelligent observant dudes on motorcycles wearing leather jackets could sum up so well what is being hidden from the world. Good on you mate!
One gets the impression that these developers get cheap loans/grants from The Party, half build these developments and run off with the rest of the cash. I might be mistaken.
Exactly, happens all around the world, but especially in China.
Happens alot. Someone's brother got a lot of money to build houses in Iraq and only a fraction got built.
@@funwithmagnus8570 bluths
@@funwithmagnus8570 Yeah so kind and helpful to bomb them down and offer your friends and family to rebuild them!
@@rocketsmall4547 yes lol
So glad to have found your channels and actually understand what is going on in China!
'Pay no attention to that man behind the curtain' springs to mind!
Keep up the good work. 🤟
This is scary. Pretty much anywhere else, when the bottom drops out of the real estate market (and this happens), you can reasonably expect it will eventually recover, simply because people still need places to live and work. The ONLY thing these Ghost Cities can do is just sit there and be valuable, you can't actually live in them. Even assuming a buttload of people suddenly wanted to, for some reason.
If the Chinese invested as much in Gold, and the bottom completely fell out of the price of that, you could still use it for electronics or even just to line sewer pipes or something. But this? It will end very very VERY badly, there is no upside, no path for recovery if / when things go wrong.
It is always a question of when not if.
As a Chinese I must say thanks to such your great investigations!
My friend and his wife have been trying to sell their chinese investment apartment for quite some time now, and now everyone is locked down so impossible to sell anything, they are regretting buying it instead of buying from their new home country.
Thank you for sharing - so incredibly sad for the people.
I have personal experience with the construction in China. I am married to a Chinese doctor (2003 till now)as well which allowed me to visit several sites because of her contacts with a bank senior manager as well visit homes of some of the friends and was shocked to see some of the conditions. As a construction superintendent (35yrs) in both light and heavy construction, it was immediately apparent a major problem was the sand they were using (dirty). That's why you see the scaly corroded areas around the cracks.
Isn't that typical? Cheapest route to desired outcome.
Dennis, disturbing , thanks for sharing. Covid-19 , Supply Chain, Ukraine war/invasion and a China generated potential property crash. Who knows what comes next !
So their economy will soon be falling apart?
"dirty sand" is used for the filler walls, not the main columns and beams.
I have been a construction project partner in China, where I have lived for the last 17 years, and the building code is just fine, unless you have some evidence of buildings collapsing that I have never seen ..??
Would you like a list of building, bridge and other structure collapses in the USA while I'm here?
@@binathere2574 You think that's unique to China do you?
I used an apartment in Nanshan Shenzhen and another apartment in Zhuhai for my business. The first was in a highly utilized place with meaningful value and excellent local jobs to pay the bills; and the latter was in an empty new building in a ghost area with low-income jobs unable to pay bills for such apartment. Problem is all these ghost areas made in areas with no jobs will never become sustainable.
But they've already done their purpose. Imagine the amount of $ that has been lent because some chinese developers came to the bank n said they have some high rise somewhere worth x amount of dollars. The entire global economic system is a giant sham
You wrote "apartments made in areas with no jobs" so all they need is good transport to nearest working city.
@@markae0 But they have no power grid, sewer system, or water. It is a building frame. There are no elevators and most of the buildings do not even have stairs. They built the building without even a single staircase.
@@andrewh1113 .. are you sure china buildings no power or water or elevators, I see some lights... With concrete walls they must run conduit otherwise it's too late ..
@@markae0 From what I've seen, those ghost city areas are often not with easy commutes to areas with great jobs. For example, the Zhuhai area I mentioned will need first a taxi trip, then a boat trip for getting to Shenzhen and from the ferry terminal in Shenzhen, you can spend a long time in a subway train to near your work place and then take another taxi to your work. Besides the commute time, people won't have the money for such commute. It appears to me that these ghost cities were made specifically with consideration of where it was cheap to make such buildings (= areas with few jobs) rather than where it made sense for enabling an income paying for those housing expenses.
I remember when the ten square miles around the imperial palace in Tokyo was worth more on paper than all the land in Canada. Bubbles pop.
I went there August 2019. Damn it was hot
At least those were livable spaces, unlike the ones in China, which are just waiting for a wrecking ball.
Yes. That was in the 90s and Japan had never recovered from that bubble. It did not let its banks fail ( stupid US did the same in 2008) and now is highly leveraged,
The Chinese did this in Vancouver as well. Bought up neighborhoods of homes and didn't live in them, then I saw the game come to Los Angeles. Foreigners offering 5 and 6x the asking prices of homes in LA driving the real estate market through the roof. When that started to cool off I began to see building around Hollywood, some on neighborhood streets, some on main thoroughfares being destroyed and new buildings going up. It has made chaos out of these streets as they were not made for the amount of traffic now using them. China and the US have the same strategies, 0% interest rates and all.
I lived in South Korea for a few years teaching at a university- i was headhunted to go to Hong Kong the entire time - after finally saying yes and doing due diligence - I thought it was going to he amazing - after arriving I found that I was actually teaching babies in diapers that could stand or speak in general - in addition my apartment was was over 2 hours away from the school on the border in China - it was insane - I left after 2 days on a midnight flight
The other huge issue with these constructions is that almost all of them have been built with substandard materials and building practices which means within 10 years most of these buildings will only be fit for demolition....
I suspect many will collapse on their own accord too. You can't have empty husks of buildings with no windows or proper ventilation, especially in some of these humid wet areas and expect the concrete / steel to last, especially not if its not built correctly.
thats a myth
@@levelazn No myth buddy. I lived in Shenzhen for over 2 years and I can tell you from experience that buildings less than 10 years old are indeed literally crumbling. I lived in a 32 story apartment that was only 5 years old and saw whole sections of wall tiles just slide off almost hitting people walking by. In Shenzhen Mall there was rusting reinforcing steel breaking through concrete columns and at the time this structure was also only around 5 years old...
@@baarni how come I never saw that when I visited China ? I live in the us and the infrastructure sucks here. Roads have potholes and bent my rims 3 times.
@@levelazn Dude, I don't know about the US but I do know what I observed in China.... Building practices are scary dangerous... To be honest though the roads in China were awesome, that is something I never had an issue with... I live in Australia and can tell you the roads in China are way better. I have pot holes everywhere here too.
This is chilling and eye awakening. Unfortunately not well known here in the US. Always appreciate the work you do.