Economist says China's housing stock value accounts for gdp75%

The real estate bubble is the biggest macroeconomic risk for China in the next few years, Wang said, but it has not yet come to the point where the "Caixin Net" (intern Qinsi) debate about China's housing bubble continues, both from the housing stock value and from the leverage ratio. In response to "China's housing stock value of 350% of GDP, and the level of the Japanese real estate bubble before the collapse of 20 years ago," said UBS Chinese economist Wang Tao, February 22, said: The real estate bubble is indeed China's biggest macroeconomic risk in the next few years, but regardless of the value of housing stock,　　or from the leverage ratio, have not yet come to that step.　　Wang Tao estimates that the value of housing in China is about 75% of GDP, far below the said. Wang Tao's calculations are as follows: The total area of housing in 1985 years plus the cumulative completion area after the housing (China began to publish annual housing completion Data in 1985), and then use 3% depreciation rate to obtain adjusted urban housing stock area. In addition, considering the poor quality of some housing buildings built in the 80 and early 90, and the rental housing with low quality, the final adjusted housing stock value accounted for about 75% of the 2010-year GDP.　　such as 2010 years of new commercial housing market prices to calculate the total housing stock value, the data obtained is 120%.　　She suggested that China's total physical capital stock, including housing, other construction, production facilities, machinery and infrastructure, was only about 270% of GDP, so the value of the housing stock should be much lower than 350% of GDP, regardless of the algorithm difference. Ms. Wang said the housing bubble was a concern but never reached the level before the Japanese property bubble. In fact, the housing stock value is not the only criterion to judge the real estate bubble.　　For example, before the subprime crisis of 2006, the U.S. housing stock was 170% of GDP, Germany was 270%, and Japan was 200%. "Looking at the housing stock will not come to the United States in developed countries, there is a housing bubble and will emerge in decades the worst financial crisis in the conclusion." "The development, taxation and policy of a country's financial market will affect the value of housing stock, and the level of leverage is also an important factor in judging real estate bubbles," Ms. Wang said.