Here’s Where You’ll Find the Largest Real Estate Bubble in History

Here’s Where You’ll Find the Largest Real Estate Bubble in HistoryIf you thought that the U.S. housing meltdown was huge, you haven’t seen China, where the largest real estate bubble in history is being created, whole cities of towering condominiums with fresh infrastructure — and no one around.
The CBS newsmagazine 60 Minutes Sunday aired a fascinating look at China’s “ghost cities” of new towers, vacant subdivisions, empty shopping malls, and no residents.
The government changed its policy 15 years ago and allowed people to buy their own homes. But now the primary investment vehicle of the world’s largest growing  middle-class is real estate. China’s state-controlled economy is pouring up to 30 percent of its output into these concrete canyons.
“So what they do is they invest in property because property prices have always gone up by more than inflation,” Gillem Tulloch, a Hong Kong based financial analyst, told 60 Minutes correspondent Lesley Stahl.
Stahl: And they believe it will always go up?
Tulloch: Yeah, just like they believed in the U.S.
“Property values have doubled and tripled and more — so people in the middle class have sunk every last penny into buying five, even 10 apartments, fueling a building bonanza unprecedented in human history,” Stahl said.
The assumption is: “if you build it, they’ll come.” But no one’s coming.
Watch the 60 Minutes segment:

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