What This $100B Ghost City Reveals About China’s Property Crisis | WSJ
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- Опубликовано: 2 июн 2024
- Country Garden, once seen as one of China’s most stable property developers, is now struggling financially, leaving the future of unfinished megadevelopments like the $100 billion Forest City in doubt.
The real estate project in southern Malaysia was planned to house around 700,000 people, but only 9,000 people live there with most units left empty. So why are Chinese real estate companies like the Evergrande Group and Sunac falling into financial distress?
WSJ explains why China’s real estate developers are in the red.
0:00 Forest City
0:48 China’s real estate market
2:56 What’s next?
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I’m from Malaysia and I think properties are not meant to be speculated. It’s sad and ironic that we are living in this world yet may be priced out of having roof over our heads. There’s plenty of stuffs to speculate but properties should not be one of them.
This is not about speculation. These ghost cities will be the smart cities
I don’t understand why this is a bad thing. Developers adding dense housing to inventory is not a bad thing, isn’t it? That would help alleviate cost of living increases which seems to plague the world
Dense housing is great. Real Estate speculation is bad. You can have one without the other.
Yes it shouldn't because Residential buildings don’t create wealth, they are liabilities. Saying the building is adding to GDP is false. Any profit its making is clearly the illusion of the ponzi scheme. Now it all comes crashing down like every ponzi and creates trouble.
The issue is these building are not added to the market as inventory. They are being left empty by investors who will never live in them. They won't be rented out either. Many of these investors believe the buildings will lose value once they are used.@@0IIIIII
Being a Florida native, there is nothing that makes me happier than seeing real estate developers lose their pants for trying to rapidly urbanize an area for the sake of speculation.
would be nice if tampa and miami homes went back to 2019 prices. its gotten ridiculous
They are doing it all over Texas also. Ripping up beautiful, bucolic countryside and building massive apartment complexes and 6-lane highways.
🧂
@@carefulconsumer8682in terms of land use efficiency those apartments are far better than a suburban neighborhood
Very similar happening here with people just buying multiple secondary homes as speculative asset and just looking it up or putting for Short or long term rent.
Evergrande eventually defaulted so I don't see how Country Garden could escape the same fate considering the housing market even gets worse everyday.
they defaulted in US and EU, not in China, to avoid paying back western investors
@@artmaknev3738Their balance sheet cannot pay back China’s investors either.
Non of them will default in China, because the government is keeping them alive, requiring them to die after finishing their building projects. However, that caused their debt holders to fall, like construction companies and construction materials companies.
Their Government was cracking down on these developers since 2011...thats why we heard of the underground economy and shadow banks... It's been crack down after crackdown and regulations since. Culminating in them seeking money flow and selling their junk bonds to foreign investors. The real problem is these developers are greedy. There are still a few hundred million rural people expected to move to the cities. But not enough affordable housing is being made for them
Scammers
The good side is that residential properties are transforming from investment to living-in properties because of the price drops.
When you compare the cost/sqft (even after drop) against Malaysian average salary then you will notice where is the problem. This project simply put only targeting international buyer. So you will rarely see local business move there due to high cost and no demand.
@@chanhou964 If the price collapse enough they would be able to afford it.
Yup
Their Government was cracking down on these developers since 2011...thats why we heard of the underground economy and shadow banks... It's been crack down after crackdown and regulations since. Culminating in them seeking money flow and selling their junk bonds to foreign investors. The real problem is these developers are greedy. There are still a few hundred million rural people expected to move to the cities. But not enough affordable housing is being made for them
@@maggiejetson7904This is not the case. Actually many buildings of the project in Malaysia have not been completed so they are not livable. Most parts have not started. Country Garden still has lots of projects in progress in China. The company does not have sufficient funding to complete these projects. The China government forces the company to use all funding to finish pending projects in China first to make sure that consumers can get their own properties. They totally have no intention to complete the project in Malaysia.
What are the chances of the GOV stepping in to complete the project if CG default? Letting it be abandoned is not really a good look and there's truly a potential in the project if completed.
Even if the GOV have no money now, maybe in the future it will still be completed?
I think there's a huge potential that CG is also looking for a bailout from the local GOV.
Man it's almost as if we should be building to provide living for people and NOT using real estate for speculative investment. Crazy that, huh.
China also give house to his citezen thorough relocation program
People who don't own property complain property prices are too expensive. As soon as they can afford it, they start complaining their property value isn't going up fast enough. Rinse and repeat. "F*** you I got mine" mentality seems to be universal in humans.
@@UserName92149If only that apartment was the only one they'd ever buy. But we all know that's not the case.
🧂
Exactly... house and property industry must be overhauled around the world..the price is getting crazy each year
some places are experiencing housing shortage while others are over-building
Over building can still lead to a shortage of affordable housing.
funnily enough, the same places with housing shortages are also over bulding
@@luqmanfauzi3583 Correct. It's a common mistake that wealthy people think that housing development for people like themselves is a smarter investment than making housing working class people.
Just of a bunch of out of touch snobs, who overestimate their own intelligence.
Build more,.. a Cedars Sinai & a Cleveland Clinic & a Raffle's, and a Cesars Palace and Trading floor & Casino floor in the Bellagio Shanghai, and Cesars Palace casino floor right Beside It,..
I am staying near this ghost town in Johor Malaysia. It is dilapidated with many Chinese surveillance technologies.... Scary as well.
Privately owned developers among the top 100 were nearly all wiped out, while nearly 90% of the party-owned developers stayed. That’s the scary thing.
ah... that explain a lot of things.
China should have pursued public housing models.
THAT IS COMMUNISM
CCP has deep pockets 😂
yes there are public housing but occupied by families of corrupted governor@@Western_Decline
they destroyed the mangroves to build this monstrosity, our views at Sg Buloh destroyed. Glad the properties gone down the way of the dogs.
Actually The B1M made a video claiming that FOrest City being built on reclaimed land reduces the amt of deforestation needed
Oh well, in a few years it will truly live up to its name as a 'Forest' City.
its already happening, i was living there and you could see the monkeys and monitor lizards casually crossing the road. the place is devoid of human residents, though there are way more human staff working there.
😂😂😂😂😂😂😂
@@daeseongkim93 This is Malaysia, that is a normal sight.
the new name is 'ghost'
What happens when you get insane levels of corruption, extremely low quality construction selling for 45x the average salary, buildings that literally fall apart, and disaster economy
It's hard to tell how much of the greenery on the buildings in Forest City is intended to be there. For now, it's just a great set for a post apocalyptic movie. Hardly any need for editing.
@@gaius_octavius oh, please. 🙄 "but okay", indeed.
there are literally hundreds of these cities in China
Country Garden is known for its very agressive expansion strategy, not for being prudent.
@@WellSalt-Studio😂😂😂😂 Most of their buildings are in Tier 3 and 4 cities of China, with net outflow of young people. And the real estate price there have slumped more than 50%😂. What makes you think it can pay back their debt? Country Garden’s headquarter is in Shunde, a place I lived in for decades. We local people know how bad the situation is.
No, this project is being pitched by Malaysia. This project was next to Singapore. The plan was to attract residents from Singapore, but it was sabotaged by the change of government palace fighting in Malaysia.
@@haochengzhai7156 There are a lot of problems within their internal structure, not just geopolitics. I got to see a glimpse of it firsthand.
1) It was started to attract "foreign" buyers.
2) When Captail outflow was restricted, Forest City demanded monthly payments still. Property owners complained and had to default payment. (Was the issue resolved, I did not know) But what I know it started the downward demand.
3) What they did next was to get Singapore property agents to start selling to Singaporeans. They built a mini showroom at Suntec City. They rely heavily on property agents to market the product. But fail to look into their own marketing channel.
4) Here is the kicker: marketing/creative companies came to pitch, but being hierarchical and authoritarian, they pretended to "know" (which means dun tell them what to do, they will tell us what to do) and said they already "did" it and rejected pitches and ideas.
5) The turnover rate of the local staff is crazy because if they fail 3 months in sales, you know what happens.
Overall, internally they fail to manage the project properly and think highly of themselves. Only now they are desperate and start to talk and ask the Malaysian government for help. Which now PM Anwar is considering.
So I hope this gives a bit of a clearer picture.
@@haochengzhai7156这些人是不会说政府政策的变动导致公司经营陷入困境的，碧桂园因为这个项目陷入债务困境，他们只会攻击中国人去他妈的。
that's totally true about county garden atm, for real estate bubble burst, stay away from Chinese stock no joke
Their big mistake was transport links; they should have built a quay with regular fast ferries running to and from super-expensive Singapore, as well as rail links and bus routes to the rest of Malaysia. Forest City is not only in the middle of nowhere, it's also incredibly difficult to reach without a car.
Yep, it's true..transportation is the main problem here.
Totally agree. Decades on now, and the traffic jams at the Causeway remain ridiculous. Tuas second link is far.
This is in Malaysian border. Even they build the ferry terminal, they would not legally able to go to Singapore without having to go through the immigration 😅
So Singapore & Malaysia set up a new immigration point ....?
Forest City did lobby for a train station on the now-cancelled HSR between Singapore & KL. Alternatively maybe KTM could extend its western branch in Johor state from Nusajaya to Forest City' & then to the 2nd Link border crossing to SIngapore, & join up with Tuas Link MRT station there
For those of us who are over age 25, we got to see the modern Chinas golden age and we are now witnessing its end. Idk why people watch reality tv shows - this is far more compelling
Oh, I have 2 friends with a combined 14 years experience of living in China and doing business there. They have now moved out. They come from England and South Africa. And they now moved to the US to work for big American corporations that are afraid of being scammed in China. They say the golden era is over. You cant even go there now without having secret police coming into your home asking for papers every other day. They really want white people out. They want to do things their way. And the corruption is equal to Russia. Just like America, Chinese government doesnt care. They just print new money at an insane rate.
totalitarian empires in decline lashes out...
Lol, you've got no idea how economics works.
@@jin_asap Deflation and having the largest companies in a sector that makes up a stupefying 31% of your economy going bankrupt as your population begins to decline on top of not having built up the welfare state to counteract that decrease in working age population while having one of the highest levels of wealth inequality on the planet sure is not how healthy economies work.
But hey, maybe China is just playing with 12D chess with it's eocnomics, just like how people claimed with their 1-child-policy for decades. Oh wait... that directly led them into these problems
Enlighten us
Hundred billion? Hundred billion what.... 90% of that went to yachts and supercars.
If such insane property developers are in immense trouble, so are many banks across China? Real estate trouble usually equals banking trouble.
bank lend mortgages,
because house are sold before they were built.. loan to developer are recovered by this mortgage.
and gov fine developer low their selling price.
you get it ？
@lancelotf.x3619 if you are correct, then how come developers default? The already sold all units before their completion and the owners paid for that? There must be a link that causes all this mess. Guess what? You get it?
@@joonwonlee1567covid
Chinese biggest banks aren't real banks like those in the US. They are in fact government agencies. They have superior power and will never get in trouble, unless the government itself is in trouble.
Their Government was cracking down on these developers since 2011...thats why we heard of the underground economy and shadow banks... It's been crack down after crackdown and regulations since. Culminating in them seeking money flow and selling their junk bonds to foreign investors. The real problem is these developers are greedy. There are still a few hundred million rural people expected to move to the cities. But not enough affordable housing is being made for them
Nothing like building tons of units that are priced outside the wealth and incomes of the vast majority of the people.
🧂🧂
The property bubble was there from the start, it was a matter of when it would burst. How can anyone not notice it when you have a huge proportion of completed residences go unoccuppied? The owners/speculators had to learn their lesson one way or another, unfortunately the painful way!
if everyone is making money no cares to look.
This is just my take on projects like this, as a Malaysian I feel like the idea of these types of projects are unfair, i mean I get it it’s original purpose was not directed towards Malaysians. I just feel that if they aimed this project towards actual citizens with genuine reasonable prices for owning the property some might actually move in, it’s a cool place
Chinese people WHO bought a property unit in China from same developer will receive a free unit in forest city!
@@charsiew88 seriously that's like buy 1 get free 1 but it's must very expensive for commoners buy their own land in China, another reason is there is communists policy that can take your your own land for government to develop
@@mr.cannedble9724 properties in Shanghai can sell 20 Times the value Of Forest CITY apartments
Unfair? This project was never built for locals in mind to begin with. Its for china people who need to move cash overseas to circumvent their internal policies.
Only 5 comments, but 4 comments are wrong or biased.
1. @charsiew88 a lie about getting free unit.
2. @mr.cannedble9724 a lie about govt will take your land. In China, all land belongs to all peoples in form of govt. No own land in China.
3. @keanhonglau is right. The original target customer is the people working in Singapore, whether they are which country from, even from China.
4. @deathempire70 it's a stupid idea to invest on real estate to move cash, especially on a in-completed project.
I went there a few months ago on my way to JB from Singapore, we didn't see more than 100 people there (that included the staff maintaining the gardens)
When Housing is not build for real demand, but just for investment, you know the system is f..ed up.
Kinda crazy that Country Garden has nearly a quarter trillion dollars of debt
Also because the quality of construction is so bad they will all either fall down or be demolished.
The problem with Chinese Developers is that when they want to build something, they really want to it make big. They also do so many projects at the same time. Forest city is huge and Country Gardens alone have more than 3000 projects across China. The amount of investment is just crazy and that is why they have to rely so much on debt. It is all about greed.
I went to Johor Bahru last year and saw Forest City. The high rises are very densely packed. That's doesn't make sense for JB which isn't a very populated city particularly not at that location. I hope they tear down the whole thing.
Should tax the onwers at higher rate is it not occupied. If dont pay repossesd and auction off. If it is eyesore tear it down and return to nature. Too expansive to maintain in long term
Maybe FOrest City was targeting people who wanted to live in Singapore but found it to expensive
To me, as a Singaporean, Forest City was a joke right from the get go. Singaporeans are smart and we are cash rich. If this had been viable we would have long invested in it.
This is not a project that failed because of China's property crisis. It was announced way earlier in at least 2016 when China's property market was still booming. It failed because these developers completely fail to factor in locality (Malaysian politics and supporting infrastructure etc), and treat Singapore like a Chinese city where Chinese nationals can easily come and work and study (hint: it's not that easy because it is a completely different country in a different region).
The dreadful thought of daily commute through Tuas checkpoint alone was awful enough. That's why Forest City was only for PRC Chinese buyers alone to begin with, No one who lived in Singapore long enough would have been so insane to buy there, no matter how much of a discount it was at.
This project was originally created to boost the Malaysian and Singaporean economy. It was designed primarily for wealthy Chinese entrepreneurs and investors, and also provided a way for them to diversify internationally and move money out of the PRC. Change in political and economic climate eventually led to its downfall. The master plan included infrastructure upgrades, creation of a special economic and taxation zone, and exclusive internal customs and border checkpoint. There was also to be special visa status for the residents there travelling to Singapore and Malaysia. However, the project was overly optimistic and the construction and environmental costs were staggering.
Not all singaporeans are cash rich bruhhh
@@mrslcom 'boost' the economy by real estate? No thank u. Malaysia has no lack of good developers or houses. Even tiny Singapore has her HDB. This is purely a Chinese play from Chinese perspective in Chinese interest.
The Iskandar project makes much more economic sense for us, and even so we were also very careful with it.
@@aceryerof course bro
This doesn't seem at all related to China's property crisis. The reason for the poor apartment sales was, as mentioned in the video 1) Beijing refusing overseas money transfers and 2) Kuala Lumpur possibly restricting the number of Chinese buyers. That is, the large debt of Country Garden and poor home sales is related to a (presumed) change of government policy in China and Malaysia. Whereas, in China, the large debt of real estate construction companies is directly correlated with slowing demand for new homes.
WSJ lies again. Smh
this sums it very well
China capital controls and Malaysia preferences for locals was well known, so why build first.
Just excuses for company that was careless and aggressive to meet numbers.
1st tier cities have recovered.. as soon as the rest have restocked the empty shelves it would be business as usual
WSJ should go to China to verify these ghost cities they mentioned because all of them are currently occupied but I guess it can't because it was banned from China for producing fake and anti-China news. Associated Press did go and verified that there are no ghost cities.
This what happens when greed works on a national scale. Everyone wants to invest, but no one wants to stay so there is no real demand. When there is no real demand to stay, property value plummets and all these investors make losses. Just imagine living in a city where every single home owner wants to rent out their unit, obviously competition for tenant is going to be insane as price war would ensue.
Us Filipinos have our own Forest City disaster-in-the-making; possibly even worse.
Mainland-China dredging & construction contractors , along with some unscrupulous local politicians, have been trying to pave over Manila Bay for the last few years. This rampant reclamation is setting up to be an absolute ecological disaster for the body of water That is “the lungs of the greater metro manila” area.
They want to turn it into a new Expat haven for Chinese mainlanders .
Thankfully, the new president has placed an executive order to suspend these projects for now; but for how long? Unsure yet .
I say, god bless! Philippine needs the Chinese investment. Let it be!!
Stop electing a duterte.
Edit: and a arroyo.
Condo prices in Manila have even started to cool down. It's mainly mainlanders pushing prices up in the last ten years. I wonder where condo prices will be headed without Chinese investors.
Y'know what, stop liberal party from ever eroding filipino interests by their presidential proxies. Liberal party is run by the corporate oligarchs and super clans of the country
Nope, that's a mixture of some truth and malicious fallacies with a political undertones which is in liberal leftist side of the spectrum.
Excess capital, excess labour, excess in know-how (engineers) led to this. They also built massive infrastructure in East Africa with little thought about usage (the new passenger train and railways from Addis, Ethiopia to Djibouti). The cargo rail makes sense but the passenger rail is losing money and barely utilised. Would have been better buildings between Ethiopian big cities rather than to Djibouti. But anyway, thank you China!!
Their Government was cracking down on these developers since 2011...thats why we heard of the underground economy and shadow banks... It's been crack down after crackdown and regulations since. Culminating in them seeking money flow and selling their junk bonds to foreign investors. The real problem is these developers are greedy. There are still a few hundred million rural people expected to move to the cities. But not enough affordable housing is being made for them
The homes are used to store equity/wealth. In 2008 around 70% of the people were buying their first homes in the city. By 2018, 70% of the people were buying their 2nd or 3rd homes
@@DW-op7ly The developers and the government is the same in the Chinese model.
Djibouti is a sea harbour, when you fund/build railway connection you connect to the nearest harbour first.
@@DW-op7ly the quality of the buildings is questionable, not sure how many will last 20 years.
Cheap buildings is a problem everywhere not only in China btw
It reveals capitalism subprime mortgage wont happen in China. China government will break it before uncontrollable like US.
One man's loss is another man's gain. Back in 2010 in the US, we bought a bank-owned house for $289,000. In 2022, it was worth $1.2 million. China's population size can withstand a housing crisis. The people who are losing their butts are speculators, not everyday people. Lower housing prices are fantastic for new buyers, just like what happened to us back in 2010.
Not a single mention of all the corruption.
Confucius say “The world of speculation is very speculative”😊😊
Locals won’t buy. They stay on landed properties near to eateries and markets. Foreigners won’t buy too. There is no rental value. Cost of ownership is high too, more than 1 mil rm? And no one to sell to once you are done. Not to mention the currency depreciation. How about the stability of reclaimed land? Soil given time to settle?
If the developer start selling the properties at half the price, I'm sure the whole city will be vibrant in a matter of months.
No it will start a chain reaction like in 2008. When new properties are sold way cheaper than existing ones, speculation will be high, homeowners will start selling, putting more supply than demand, and continue down the death spiral, people will default their loans, properties market will crash, sending the country into huge recession and economic depression 😂😂😂
Not really, no of homes in China is greater than no of people.
And population growth is slowing.
@@gund89123”Population growth is slowing”…. Not just slowing, it’s decreasing. They are the fastest aging population and their kids doesn’t want to reproduce even when one child policy has been lifted.
i mean they're already down from $236 a square foot to $100 a square foot so we may already be in that recession lol@@Epiderm91
You need jobs, excess cash, an optimistic attitude in order to purchase large assets such as homes.
when they say traditionally real estate has been how they've grown their wealth, how far back does that go?
1994 as a partial start of commercialization of houses. 1998 in full blow. However mass investment didn't come until 2008
@@serena-yu 👍exactly
@@serena-yu thank you!
Weird how China is bloated with real estate while the US is suffering with a shortage
It is really interesting but understandable. In the U.S. there are a lot of zoning laws that, to my knowledge, basically make it impossible to build housing for more than one family most of the time. That contributes to things like heavy urban sprawl, unwalkability, and a shortage of the housing we need I believe. Meanwhile in China they often build those hugeeee buildings that can fit tons of people and families inside them.
One does not "swim in.... a beach". The beach is a sandy shore on which one relaxes in the sun. Read a book, WSJ.
It’s ask for the propaganda anyway lol
All*
Manhattan upper east side is 80% empty. Billionaire’s row is a ghost street in the night. Affluent people have many place to live. WSJ’s editor is from ghetto.
how is the build quality of Forrest City? Because there is a bunch of country garden buildings somewhere in china that are slowly sinking. Have they exported their tofu dreg standards to malaysia and other parts of the world?
Tofu dreg was a term coined by the Chinese themselves to describe buildings which collapsed during the 2008 Sichuan Earthquake, most of which were constructed prior to China's economic boom. The fact that you think modern buildings in China are constructed similarly betrays a typical ignorance, especially with how much China has built all over ASEAN. Where is the news of Chinese construction collapsing from Vietnam, Thailand, Cambodia, Myanmar?
I also wouldn't be laughing at Chinese build quality when you live in the Philippines. All it takes is one change in weather patterns and thousands of you die each time.
As a former resident of Forest City, I can tell you that at least the unit exterior is falling apart at the seams. The drainage clogs up almost instantly in the shower, even before moving in, and no amount of drainage cleaners could deal with it. The bathroom lock is a pivot hook on a sliding door and on my second night moving in, it locked itself from the inside and its near impossible to jiggle something to unlock the hook from the other side. The insulation is horrendous in the lobbies of buildings, and their central air-conditioning was probably either not operational or for budgetary reasons not considered even in their hotel lobbies. The bedside lamp in one of the hotel rooms was knocked completely off the wall when a foam ball made slight contact with it, it was hollow beside the wiring and the lamp not screwed in properly. WiFi infrastructure was also terrible because for an entire half of the island's towers called Ataraxia, there was a whole network outage and none of the landlords or management would inform us about the reason why for half a day it was out. And on another day when a considerable part of the bridge that connects Forest City to mainland Johor Bahru collapsed because of its shoddy construction, island residents could not leave for a day while they worked to build an alternative dirt road and ramp to connect the working lane of the bridge. Because of the bridge collapse, we were notified that they had to shut down the island's power for several hours to divert it to the building of the alternate road and minor repairs of the bridge.
@@mao_zedong1921 there is no operational hotel there. Only residences. I just find it amusing that he called his condo lobby a "hotel lobby".
@@mao_zedong1921 I was a former resident that also worked at the hotel. I was living there over this summer but have since returned home to Korea.
@@huaiwei What? There are two operational hotels in Forsst City. You obviously dont know what youre talking about. There is the Phoenix Hotel and the Marina Hotel both on the eastern side of Forest City's island. There are both residential condominiums and apartment towers and two operational hotels in Forest City, all of which have lobby levels.
WSJ is using a ghost city in Malaysia as an example...while I was expecting one that's in China. Is it that hard to find one?
Half finished buildings are not property because they are not house of anyone.
Praiseworthy standards of journalism.⭐⭐⭐⭐⭐
0:20 are those nutcrackers for sale i want them
What usually happens is it's gonna sit for decades, turning into rumbles whilst the mortgaged papers or debt value increases. It's a game of physical and auditory property valuations. And at the end game, most are forced to sell or forfeited/confiscated by the developer itself due to service fees or any other maintenance fees dues for decades.
These properties often fall apart within a few years due poor materials and construction practices. I have seen videos where Chinese contractors poured concrete over cardboard.
@@jybrokenhearted造谣你是最厉害的等战争爆发的那条让你知道谁才是真的爸爸
better build an affordable house for low to medium income people
I think that government problem,not all those company
Why they don't give to poor people who lives in basements??? They have millions of poor people that may afford a cheap rent, better than keep it empty
nah, maintenance cost will be higher than what the rent can cover
they have no 'living in mom's basement' culture in malaysia
@@rollinghippo2940 and what they have? "living directly on the streets"?? I am sure there is also poor people there.
Most Malaysians have a roof over their head and the culture here is different from the West.
Extended families are normal with 3 generation within a household.
Homeless are probably the migrant neighbours who came illegally.
God those high rise builds are awful !
Pacific City already went missing in Malaysia. 🐈🤭🤣😂 no want would buy properties in a country where mosque can make 5 times daily sound pollution. Totally unlivable.
Why use a project in Malaysia to discuss the troubles in China? The Iskandar project where Forest City is was DOA. Why build homes for 3m people when the population of Johor Bahru is only 1m? Were they hoping to target Singaporeans or Chinese to live there, placing the bets not on actual people but the govts of China, Malaysia and Singapore to allow the free flow of people.
Wow this guy giving this presentation is doing a great job
I am assuming the construction is also very poor quality.
China counted the same person at the city, county, state and national level. So there are actually many fewer people in rural areas than their census indicated. Now that there is rural housing, they are discovering that the population they were expecting, is absent.
Nothing the CCP does would surprise me.
@@frankthefkintank it depended on the level of corruption. But if a state did not subtract the population of their cities from the state population, it looked like there was a large rural population. The developer collapsing this week specifically targeted large rural populations, which were counted twice and already lived in the cities.
Since the population does not live close to the new housing, they are unable to sell it.
So are you saying China's 1.3bn population is actually much lower?
@@antihypocrisy8978 One of the other Chinese news sites on youtube said that china has 1.4 billion new apartments becoming available in the next 3 years. That is larger than their entire population. It does not look like the majority of the Chinese population is currently homeless. I don't know who they expect to occupy these new apartments.
no wonder why they are being even more aggresive with territorial disputes now.
Please be advised this project is in Malaysia, not China。
Obviously they built and invested in real estate to get richer. But this would work only in a growing population type of situation. Which would never be the case with the one child policy in the past. Greed and stupidity have destroyed them.
Not forgetting these buildings might be "tofu dreg" projects. Those apartments might not even be safe to live in.
You can count on that.
living there it was generally safe just inefficient. The insulation in lobby areas is lacking so its so humid and it didnt seem like they built an AC system to accommodate the tropical weather in areas where its absolutely necessary. I had once closed the door to my units bathroom and the medieval hook latch lock locked my bathroom door from the inside. The plumbing also was ridiculous. Not even a day living there, my shower needed some drainage clog liquid.
How does high demand to buy lead to many empty properties? It's when the number of available properties exceeds demand to buy that properties stand empty.
Why would the government be so foolish to allow this to happen. Why overbuild especially so fast when that always brings down the price of the market.
As I walked around Beijing during my time there, I would pass by numerous residential construction projects. But were the buildings going up or being taken down? The quality, or lack thereof, of the construction in front of me made me wonder. Forest Garden looks like so many nondescript, hulkish buildings, kind of like vertical McMansions. Perhaps beauty is in the eye of the beholder, if beauty is at all at issue.
Bit of a stretch to try and work in the word McMansion. Apart from the copy/paste aspect they are in no way similar. One is a finished home, built to standards, that appreciates in value. At a minimum at least the property it is built on would. Those apartment complexes in 60 years will have a value of exactly 0 dollars.
McTofu
💩
Looking at the cost of this city (100BN) compared to Indonesia relocating a whole capital city (30BN), This city is truly on a whole another level of development.
People in indonesia are scare of cost and debt of their new capital but if we compare these two cities, it's almost look cheaper.
Or the costs of Nusantara are unrealistic and reflect why there has been no private investment commitment which is what the govt is relying
@@TheAp9er That could be a possibility, even forest city which is a commercial project doesn't have that much investor so idk if nusantara would attract much investor. I do think that forest city would've been much more valuable than nusantara if completed tho.
Inflated cost to fund kickback to malaysian politicians
A lot of the island was built on sand dredge up from the sea floor and not given enough time to settle, so many of the building are already cracking. not something you want in a million dollar condo
Here’s the wild thing… we’ve known about ghost cities in China for over 10 years now…
The buildings are more then likely not safe to live in.
Forest city is in Malaysia how is this chinas problem??
So many buildings to hide if zombie apocalypse comes..
This is more socially frightening than economically. Cities built and maintained in excess affordable to only a small selection of human. Meanwhile majority of people are living on small food rations in delapidated housing with no running clean water.
I know hundreds of ghost towns like Detroit in America. Unlike this place, there are really ghosts, drug addicts and robbers in American ghost towns. A disgusting ghost
Great job to the astute planning and due diligence process by the Malaysian government.
This project is based on opening a very wide door for affluent Chinese to get a foreign residence (in this case, Malaysian). Both Malaysia and Xi Jinpin now frown upon this practice.
There's a blessing in disguise for the drop in price for forest city, now the local can make it a truly liveable town.
It’s kind of strange to think that is the USA many houses are empty because people could not pay for them.
And in China there are too many houses to house people
Forest City is also part of China's Belt and Road Initiative
扯淡一样。一带一路是政府行为，森林城市是企业行为。
@shaozhihao China gives loans and grants for Chinese companies to build in other countries. So yes, it is B&R connected.
@@Jabberstax 你懂个几把的中国。
@@shaozhihao 靠！你就懂个屁啊。寻搜 Forest City 到处都说是 BRI
Yeah, how's that working out 😂
You didn't explain why the fate of the city would have ripple effects around the world.
Debt fuels expansion. Firstly if these developers can’t repay their debts to investors and consumers that hold bonds or shares these folks are SOL. If developers suddenly stop building homes all the downstream suppliers that are involved in supplying materials and labor will suddenly need to cut costs and layoff staff due to drop in demand. A failure to repay debt also creates a massive loss in confidence hurting markets and creditors will demand more interest to loan hurting debt markets, if it’s harder to borrow, its harder for other companies to grow or finance existing debt. The death spiral continues until demand picks up again.
Mark Twain said: "A Gold Mine Is a Hole in the Ground with a Liar at the Top". What we have here is just another Gold Rush.
Hopefully, the New Clark City in the Philippines could avoid this from happening.
While in America we have 1.2 million people are homeless.
You have plenty of empty houses in America too, which the homeless can't afford.
WSJ is so desperate now that it needs to go to Malaysia to report about China.
Yes, in China itself, everything is just fine!
There could be enough vacant homes in China to house up to 3 billion people, a former top China official said.
This is very very scary
有房屋沒人住，有人沒有房屋住😂
the world is so surprising😂
Country Garden also ran into several hurdles in Indonesia on the Meikarta project, a cooperation with Lippo Group.
Wait, they also own meikarta?
@@rbwicaOf course tons of money come from the river
This is what you get when you country is an investment focused GDP generation model! Nightmare!
That was nothing to do with the Chinese government?
Sometimes these developers like having F in math class...usually the number given is unrealistic like fitting 700,000 people, developing 100 billion dollar city etc. You have to divide it by 10 to sound more convincing. Otherwise it just doom they are trying too create. I wonder who can stop developers' nonsense, provide some reality checks or a small working calculator? Luckily it affects only greedy people.
Didnt hear anything new or original in this video. If you are copying from other sources at least put a smile in your face...
Tbh when I visited Johor I saw a lot of empty places like this, to many new buildings IMHO.
Bottomline : The build quality of the forest city apartment were low quality , Malaysians don't buy them.
Country garden were trying to con Mainland Chinese to buy them. Beijing stopped outflow of funds from China and you have no buyers in the end.
Ripping up beautiful wild land for this monstrous carbuncle. Its criminal. Its insane. There is NOTHING good about any of this. I hope that everybody involved goes to prison for life.
Ironic, lot of people don’t have home in the US… at the other part of the world … a city without people…
It's our crazing zoning in the US. If we relax zoning and have more multi units building, there will be no housing crisis. It is bc of the NIMBYs and legislation.
We had a Forest City and it became a Home Depot.
I lovee home depot
That was the 20% growth of 2013
Good report
Those big companies invested overseas may just wanted to transfer part of their wealth into international concurrency. The debt owners may just be themselves through some associated companies. This is what people have discussed in chinese quora "zhihu". And the investment loss belongs to those chinese buyers.
I saw the project in 2019 when I visited Lego land in johor, and I was surprised to see a beautiful place like that pretty much empty
Similar to what happened in Spain but on a massive scale .
Is there a longer version of this report? It seems like it was edited to death.