Economists at Nomura have made their call: China’s property bubble has burst, they say, and the country’s economy could slow dramatically unless Beijing steps in with new stimulus measures. “It is no longer a question of ‘if’ but rather ‘how severe’ the property market correction will be,” three of the bank’s analysts say in a new report. “We are convinced that the property sector has passed a turning point.”
Analysts at the Japan-based broker are among the most critical of China’s property sector, which has powered ahead for years despite frequent warnings that a collapse is just round the corner.
Skeptics say the real estate sector is emblematic of problems such as rapid credit expansion and policies that promote short term growth over a more balanced economy. The building rush means property supply now outstrips demand in some parts of the country.
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