The US is not the only nation to sell real estate in the wake of the financial crisis, with Chinese developers now looking to sell properties in the country, the Wall Street Journal reports.
The real estate market is in a state of flux as China continues to embrace the new wave of home buying, but analysts warn that if the country does not ease the burden of the debt load, it could end up with a huge housing shortage.
The country has the third-largest debt burden in the world after the US and Japan, and has seen a rapid rise in house prices over the past decade, with an average price of $1.1 million per square foot in June.
The Chinese are buying at a time when the country is also facing severe problems in healthcare and education, according to the Financial Times.
With Chinese authorities struggling to keep the economy growing, the country has been in the grips of a massive economic crisis.
The US has a long-term debt load of $14 trillion and the world’s second largest economy.
The Federal Reserve is also struggling to stimulate the economy, with a range of policies such as interest rate hikes and quantitative easing.
As the world faces a global housing crisis, the US is expected to announce a further round of interest rate cuts in coming weeks, and as it comes to a head, it may also ease restrictions on home purchases.
The government also recently announced a package of incentives to help encourage home ownership, which could result in an uptick in house price increases.
In the wake the financial meltdown, the Chinese government also launched an unprecedented housing program, allowing people to buy their first home in their own name.
The initiative came with a 10-year mortgage.
However, some analysts are predicting that the government will be forced to ease restrictions to accommodate the rising demand, and may be forced into a more gradual phase of easing restrictions.
“If it doesn’t, we may see a lot more Chinese investors buying real estate as they are more concerned about the health of the economy and their own finances,” Nick Kostin, head of emerging markets and emerging markets strategy at PWC Asset Management, told the WSJ.
“We could see a much smaller number of US buyers buying property in China and that would be a big setback for the US.”
The realty market in China has been rocked by a massive financial crisis.
As China’s economy has been under stress for several years, the number of homes being sold has plummeted.
Many Chinese homeowners have resorted to using money from family members or others to buy property, and in turn have been struggling to pay back their debts.
As a result, many Chinese banks have begun to foreclose on properties, leading to a significant housing shortage in the market.
The market in the United States has been especially hard hit, as the financial collapse and the housing crisis have forced many Americans to take out large loans, which in turn has caused the market to plunge.
The result has been an increase in prices in the US, as many Americans are struggling to make ends meet.
While some Americans are beginning to take a second look at their options, many are also looking to the Chinese real estate markets to make sure they stay in the game, according the WSZ.