Housing prices have fallen by 40% and speculators are selling at no loss, experts say
Over the past six months, while the overall trend for home prices across the country has remained relatively high, property prices have collapsed in many areas, with the biggest price declines near the waist.
Houses in hegang, heilongjiang province, for example, sell for the price of cabbage. While sea-view houses in shandong have returned to the prices they were 10 years ago, the hyperbole of Beijing, such as yanjiao and langfang, has seen prices drop 40 percent from their peak, and many speculators are stuck here.
Yet there are still plenty of speculators who face falling house prices and losses on paper. They are unwilling to sell the house at a reduced price. Why? In fact, this is very much in line with what economists call loss aversion. If you sell your house at a loss, you are acknowledging your loss, which is unacceptable to many people. And only the house, though the loss of books is increasing, may return one day.
Not surprisingly, speculators have this idea. After all, this has happened several times in the past 20 years. As long as they are consistent, it is always possible to solve them. But this time may be different, so this is the end of the major 20 housing markets. It's a good long term cycle. If you want to wait for the house to return, you may have to wait for the next 20 years. Then, the house will be like, nobody knows.