Is China's real estate industry really a super-profit industry? Almost all property developers say it is not. But in the new round of rising property market, a large number of enterprises have engaged in real estate business, which reflects from one side that the profits of real estate industry are "very substantial".
Data shows that among China's 132 central SOEs, only 16 take real estate as their main business, but currently more than 90 central SOEs have involved in real estate. Many central SOEs, state-owned enterprises and private enterprises "neglect their main businesses" and crowd into the real estate industry for no other reason than the "high profits" of the real estate industry.
Jiang Ming, Vice President of International Affairs of American Gulf Real Estate Co., Ltd., an American real estate agent, frankly said: "We are not encouraging Chinese to speculate in housing in the United States. The real estate in China is the most profitable in the world, so why go to the United States to speculate in housing?"
This statement is true. Look at the many real estate tycoons on the list of rich people, obviously clearly telling people that engaging in real estate development is a shortcut to "getting rich". Among the top ten richest people in the Hurun Rich List 2009 announced in October, six come from the real estate industry, including Country Garden, Hysan Development, Shimao Group, and Dalian Wanda. In addition, Evergrande,富力, Star River Bay, and Agile also rank among the top hundred rich people.
Recently, the Dubai debt crisis has also raised warnings for the development of China's real estate industry. Renowned real estate expert Jia Wolong analyzed in an interview with our newspaper that there are great differences between Dubai and China, but the current domestic house price boom and high prices, coupled with the government treating the real estate industry as a chariot to pull the economy, poses a risk in the long term. The government should in the future transition towards the development of the real economy, reduce the proportion of real estate in GDP, and prevent the formation of bubbles.
Dr. Ni Pengfei, Director of the Institute of Finance and Trade Economics at the Chinese Academy of Social Sciences, stated that the warning role of the Dubai crisis certainly exists, but its negative effects should not be exaggerated to avoid unnecessary panic affecting the normal development of the national economy.
But judging from the current situation, whether it is central SOEs and state-owned enterprises frequently acquiring land kings or listed companies crowding into real estate, it all tells us that the bubble in the real estate industry is about to or has already arrived. The recent rise in house prices has been so crazy that a market person from a Beijing real estate company told the reporter this: "We don't even know how to set the house price anymore. Originally, we thought we had set it high enough, but not only did no one think it was expensive, they continued to rush to buy."
Currently, the government regards the real estate industry as an important pillar industry for economic development and provides strong support in terms of policy and funding. Under the severe impact of the global financial crisis, it is understandable that the government values the pulling effect of the real estate industry. It is understood that real estate can drive more than 50 industries, and its pulling effect on GDP is very significant at present.
From the perspective of the government, it hopes that real estate prices will slowly rise instead of skyrocketing or plummeting, causing major shocks to the national economic development. However, the original intention of the central government's policies has been distorted and "kidnapped" by local governments and developers during implementation, becoming a tool or even an "accomplice" for the latter to make profits. (Ren Pengyu) Related thematic articles: BMW external hang ratio is higher, BMW external hang among, the high-priced houses in Beijing generally correspond to large house types over 160 square meters, the comrades of the Publicity Department of the Wuwei Municipal Committee relatively detailedly introduced the socio-economic development changes in Wuwei City since the western development, it should be regarded as a reflection of government will, and cadres at different levels often encounter different "ceiling" ages in promotions.