Skip to content
Subscriber Only

Is China’s Housing Bubble Beginning to Burst?

Residential apartment buildings under construction in Qingzhou city, in east China’s Shandong province
Residential apartment buildings under construction in Qingzhou city, in east China’s Shandong provincePhotograph by Imaginechina via AP Photo

Earlier this month, financial analysts from Japan-based Nomura Group issued a grim report on China’s housing market: “To us, it is no longer a question of ‘if’ but rather ‘how severe’ the property market correction will be,” the report read.

Nomura—which has historically been bearish on China, as the Wall Street Journal observes—predicted that a downturn in the housing market, caused by oversupply and shrinking developer financing, could sharply impact China’s economy, perhaps even driving GDP growth to less than 6 percent in 2014.