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Business/Finance See other Business/Finance Articles Title: Property bubble in China may burst due to shrinking labor force Want... A brokerage in China has forecast that the country is set to see a deficit in its labor force in 2015, possibly leading to the collapse of the housing bubble. According to a report published by Beijing-based Founder Securities in early January, China is expected to post negative growth in its working population aged between 20 and 64 beginning this year. Citing the example of Japan and several European countries, Su Jian, chief economic researcher at Founder, said an economic crisis usually takes place at such demographic turning points. The property market will be the first to see the effects of the negative growth with prices posting sharp declines, Su said. Following double-digit growth in property prices in six major cities since 1985, Japan saw the burst of its housing bubble after negative growth hit its working population. Statistics in China show negative growth in the population since 2012 for child-bearing age women between 15 and 49 as well as for the overall population between the ages of 20 and 29. The declining number of newborns and rapidly aging population are reflected by growing supply that outpaces demand in the property market. JP Morgan's chief China economist Zhu Haibin said the country is set to see its housing market correction continue in 2015, when housing prices could decline by 2% to 3%. Despite a rebound in commercial properties during the second half of last year, it remains unclear whether the trend can be expected to continue this year, Zhu added. Several real estate experts said the property boom over the past decade is unlikely to repeat itself, but the level of price movements will ultimately be decided by regional factors. While Ordos in Inner Mongolia has become a ghost town after the housing bubble collapsed, Beijing has not seen significant declines in prices because of its status as the national capital. References: Su Jian 蘇劍 Zhu Haibin 朱海斌 Poster Comment: Story implies working population declining due to age demographics...so may be job opportunities for America's unemployed...learn mandarin...move to where jobs are, Post Comment Private Reply Ignore Thread
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