The government has engineered a cyclical downturn in the Chinese real estate market instead of a structural collapse.
There are a number of investment options for investors who want profit from activity in the Chinese real estate market.
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Fueled by low interest rates and a flood of money from wealthy Chinese, Hong Kong's real-estate market has boomed, with residential prices up 120% and commercial real-estate prices up 90% since the start of 2008, according to government data.
Chinese real-estate prices vary greatly among locations and by market segmentation, and analysts differ on the extent of the market correction since tightening began in 2010.
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But a volatile stock market, and caps on what middle and upper income investors can buy in the high flying real estate market have reduced investment opportunities for Chinese.
The stock market and real estate, in the Chinese view, are scarcely different from a casino.
Home prices in key Chinese cities rose, indicating government efforts to control the real-estate market are having little effect.
One of the reasons the China real estate market is so hot is because wealthy Chinese are buying up property to hold onto real assets, rather than put money in low yielding bank bonds and volatile equities.
Even so, the drooping real-estate market, combined with declining demand for Chinese exports in Europe and elsewhere, pulled back China's economy to an 8.1% pace in the first quarter of 2012, the slowest growth since the spring of 2009, when the world was in recession.
In parallel, heavy investments and speculative buying drove housing prices up to levels found in New York and Tokyo, overheating the real estate market and putting housing prices beyond the reach of most Chinese.
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The Chinese government has been heavy handed in the local economy, especially on efforts to curb its red hot real estate market.
Sanctions would disrupt a major portion of the U.S.-Chinese shipping market controlled by Cosco, whose business lines include port terminals and warehousing, insurance, real estate and hotel management.
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