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There was a time that real estate markets were mostly local matters. Housing markets could attain national status in some countries where internal populations had freedom of movement within their country, but even then, real estate was still constrained within one nation’s boundaries. That has changed.

Part of the change was the economic merging of many countries in the European Union into a single market. Citizens of involved countries had European citizenship instead of national citizenship and could move freely among many different nations. Many wound up flocking from urbanized and populated areas to spaces where housing was more readily available.

The ascension of China’s economy as one of the world’s most dominant had even more impact. With a burgeoning middle and upper class teeming with newfound wealth, they needed places to invest it. Options were limited within their own country, so they started targeting real estate overseas as places to park their wealth. Unfortunately, it’s very possible that the market for Chinese real estate could impact the rest of the world.

The central government based in Beijing has been worried for some time about a potential housing bubble making residential properties and possibilities unaffordable for a populace that has over a billion citizens. As such, they’ve directly interfered with the national real estate market in an attempt to stabilize the sector while preventing it from getting too hot.

This has resulted in serious instability with some of the biggest real estate firms in the country. Not just an economic issue, it’s one that is now both political and social, creating even more tension. The Chinese real estate markets are relatively closed off to foreign investment, but major real estate firms in China have significant dealings and exposure to international economic matters.

Any instability inside China’s economy will have a ripple effect around the world. Steady growth of China’s economy has been a pillar of international growth for decades, and many nations are reliant on China for their economic ties. Real estate turbulence in China might look like a local matter, but it wouldn’t take much for it to spill over into sectors that would impact the world. Manufacturing is the biggest potential threat, but shipping and freight would be a close second.