The Tangled Web The Chinese Are Weaving:
This week I was going to write about the Toronto housing market where the average price of homes has fallen 12% from its peak since the introduction of the 15% foreign buyers tax. We saw a similar reaction in the Vancouver housing market back in August of last year. However, the gyrations of the housing market in Vancouver and Toronto in particular, are to a significant extent, merely a reaction to the financial machinations of the Chinese government policies.
Big news from China this week is that:
“Several of China's largest overseas asset buyers, including billionaire Wang Jianlin's Wanda Group, are being placed under scrutiny, amid a government crackdown on money laundering and a grand campaign to check financial risks ahead of the 19th party congress.”
The Chinese government is placing the financial affairs some some of China's largest international asset buyers under “scrutiny” for possible money laundering. You just have to be suspicious as to why the Chinese government would single out certain companies and what the motivation behind this scrutiny really is. One would have to suspect that there is a lot of back room plotting and political manoeuvring behind such a crackdown.
Nonetheless, the implications could have global repercussions should the financial and political aspirations of these corporations not align with the financial and political objectives of the People's Party. Apparently, Chinese controlled banks will be conducting the reviews of select companies to ascertain their guilt or innocence:
“The reviews will be conducted by a number of banks, including Industrial & Commercial Bank of China, China Construction Bank, Bank of Communications and China Guangfa Bank, according to the emails.”
My point being, that the global shopping spree binge that Chinese corporations and individuals have been on these past two decades simply can't go on forever. The financial house of cards I've pointed out in previous articles will eventually tumble affecting many real estate markets ~ Vancouver and Toronto especially.
So perhaps the source of any collapse may just be as a result of internal wrangling among the Chinese political and business elite and their divergent hegemonic visions of their respective roles in this Chinese miracle of global economic expansion. Again, only time will tell.
PS: If Vancouver is any road map, the Toronto housing market will recover as the new 15% foreign buyers tax is accepted and dealt with in the “market” place, such as it is.
Source: ”China's banking regulator orders loan checks on Wanda, Fosun, HNA, others”.
CNBC June 22, 2017.
#Toronto #vancouver #realestate #realestateagents #realestateinvesting #homes #home #Forsale #Realtors #Realtor #realtorlife #foreignpolicy