Measuring China’s economy, getting a sense of what is really happening out there, is never easy, but it’s always useful to take a view on the property market, which has had a central role to play for 30 years and more. And it’s not going well still. This week we see that the number of rental listings for apartments is rising sharply, and the rental rates on offer are falling. In other words, the issue of over-capacity and competition leading to falling prices and deflation—all wrapped up in the famous involution (內卷), meaning cutthroat competition leading to falling prices and vicious inter-company competition is endemic in the property market as well. Another bad sign for the property market was a report this week of how economic zones around China are offering companies free rental space for long periods as a way of attracting tenants. Not a great indicator of economic vitality. Just a couple of weeks ago we also had a 7% drop in the number of new house apartment sales.
Meanwhile, it’s nearly the end of summer, global uncertainty continues, and there is a general sense that Chinese economy is not seeing any sign of up-ness anytime soon.
Have a great weekend anyway.