Chinese billionaire Wang Jianlin, whose vast property and entertainment empire reportedly brought in $44 billion in revenue last year, appeared on CNN Wednesday to warn about what lies ahead for the country’s overheated real-estate market.
It’s the biggest bubble in history… I don’t see a good solution to this problem. The government has come up with all sorts of measures — limiting purchase or credit — but none have worked.
Jianlin pointed to the troubling fact that real estate prices just keep rising in the major cities, like Shanghai and Beijing, while falling across the rest of the country, where smaller cities are littered by properties that lie vacant.
“The problem is the economy hasn’t bottomed out,” he told CNN. “If we remove leverage too fast, the economy may suffer further. So we’ll have to wait until the economy is back on the track of rebounding — that’s when we gradually reduce leverage and debts.”