Chapter 8 Hainan Property Market Bubble

"Second uncle, you entered the Hainan real estate market in 1991, right? At that time, the land price in Hainan should be very cheap. How much is the land price in Hainan now? I don't think I can get it without millions. Am I right?"

Tang Tianhao looked surprised and saw that the eldest brother also looked at him, so he nodded,

"Xiaoyu, where do you know these things? Outsiders don't know much about this. When I first entered the Hainan real estate market in 1991, the land price was only 160,000 yuan per mu. At that time, I was not sure about the market and did not dare to buy more. I didn't think about it. After that, the land price soared all the way. By the end of last year, the land price had soared to 6 million yuan per mu. It is only April, and the land price is close to 7 million yuan per mu. I regret it now. If I had bought more land at that time, maybe your second uncle would be the third billionaire in Dongling now. Now it's more and more difficult to buy land from the Hainan government or directly allocate it to the government. It's not my turn to be a baseless outsider like us. When I come back this time, I'm going to get some money in Dongling City to get another piece of land in Hainan and slowly appreciate it.

Hearing what Tang Tianhao said, Tang Yu understood at this time that the debt owed by his second uncle to the bank in his previous life was probably borrowed from Dongling at this time, and then it was completely added to the bubble in Hainan.

"Uncle, don't ask me how I know this. Just listen to me. Is the house price in Hainan less than 1,500 yuan per square meter in 1991? Is the current price more than 7,000 yuan per square meter?"

"That's right. When I entered the Hainan real estate market at the beginning of 1991, it was about 1,400 yuan per square meter of commercial housing, and now it is about 7,500 yuan per square meter. However, the house price there is one price a day, and it may rise to 7,600 tomorrow. Hainan people, rich."

"The second uncle said that the real estate market in Hainan is one price a day, which comes to the point. This rapid growth is not in line with the laws of the market at all. The housing prices in Hainan are certainly not pulled up because of the naturally growing market demand, but are speculated by you developers, speculators and investors. Uncle, how many people have you sold before the real estate you developed is built? I guess you know best whether the real estate you opened is sold to the public or to speculators. Also, the real estate you sold by yourself may not be developed by yourself at the beginning, right?

"Xiaoyu, you know a lot about Hainan. Now the real estate market over there is booming. Most real estate can be sold several hands in the drawing stage, so the price of the real estate market only changes in a few days. I also bought a lot of land for development in the early 1991, and now I do sell a lot of real estate from others.

"My father studies economics. Let him talk about whether there is any tricks in this rapidly growing house price and a large amount of money speculation."

Tang Tianhong frowned slightly. Although he thought it was a little strange that his son knew so much, what his son said still made him think a lot.

"I didn't hear you say anything about Hainan before, but if it is really what Xiao Yu said, it is likely that there will be a large amount of hot money in real estate speculation, otherwise it is impossible for house prices to rise as much as five times in two years. This kind of popularity is abnormal, and does not conform to the laws of the market. However, now some economists are selling real estate to boost the development of the local economy. This view is still very popular in the economic community. Hainan has developed rapidly in recent years, and it is normal to have a large amount of money to enter, but it is the people below who will suffer in the end. Your second uncle, such black-hearted businessmen, won't care about this.

He was scolded by the eldest brother as a black-hearted businessman, and his second uncle did not defend it. Which businessman is not black-hearted?

"Hey hey, we real estate developers naturally know that there is a lot of money to speculate in real estate, but whether they speculate or not, in the end, we developers always make money, and others pay the bill."

"Uncle, if you say that others pay the bill, let the people of Hainan pay the bill? But uncle, you probably haven't thought about what if the people of Hainan don't pay for you?

Trying to Tang Yu that they were exploiting the money of the people of Hainan, Tang Tianhao simply opened up and said,

"We can't be blamed for this. The key is that Hainan has developed too fast in recent years. Who will make their money if they don't make it? Hainan's economic population has grown rapidly in recent years, especially after independence from Guangdong and becoming a province in 1988. In 1992, the economic growth rate was as high as 83%. Sooner or later, someone will pay for things like real estate. This kind of money is not earned for nothing.

Tang Yu was tit-for-tat, "Uncle, you said that Hainan's economic growth is as high as 83%, which is the performance of economic overheating. Besides, I'm afraid you won't care. In this 83% growth, real estate and related industries contribute more than 40%. Isn't this a very surprising data? It is true that real estate is used to drive the development of the local economy, but there is a limit to this kind of pull. If most of the growth of the local economy is the contribution of real estate, it is extremely abnormal. Moreover, if the economy is overheated, then the country's macro-control can't be guaranteed. Like the popularity of Hainan real estate, sooner or later, the country will issue policies to reduce the temperature. Last year, the aftermath of the national macro-control has not yet dropped.

"You boy, where did you learn these things? This professional terminology is also a set. It's not used to fluff your second uncle. The central regulation is not. It's up to your child's family." Tang Tianhao was a little disapproving of Tang Yu's statement.

"What Xiaoyu said is not unreasonable. If Hainan's real estate is really overheated, it does not rule out the possibility of unilateral regulation by the state. After all, the country cannot watch the uncontrolled overheating of a local economy. Of course, when the bubble in the real estate market is large enough, it depends on how high the rate of speculative house buying is. The central government wants to regulate, and the resistance is also great, but it is only possible. At present, there is no sign of regulation by the central government, and the mainstream of the economic community does not think that China's economy is overheated.

Seeing that his father agreed with part of it and did not fully agree, Tang Yu continued to say that he could achieve his goal by letting them listen to part of it. Tang Yu can remember almost every detail of the real estate bubble that made his second uncle bankrupt.

"Dad, if you say so, I guess you don't know much about speculative house buying in Hainan's real estate market, and it's estimated that the real estate area in Hainan is not enough. Who says that the central government has no sign of regulation? You ask the second uncle to tell you the specific situation of Hainan. You two, one has a theory, and the other knows the specific situation. Together, you can figure it out, so that I don't talk nonsense.

Seeing that the eldest brother also looked serious, Tang Tianhao no longer made fun of Tang Yu,

"When it comes to speculative buying houses, there are really a lot in Hainan. In the houses I developed, 80% of them are not sold to real residents, but to speculators. These speculators do not sell directly to the residents, but continue to transfer their hands. To tell you the truth, I have also done this kind of thing several times, and I have made a lot of profits. This time, there is a big deal, and the liquidity is a little insufficient, so I want to go back to Dongling City. I think other developers are similar. Many real estates have been sold several times on the design drawings. As for the area of real estate development in Hainan, I really don't know about this. It is roughly conservatively estimated to be more than 10,000 hectares. There must be only a lot more real data, but those information is also confidential in the Hainan Provincial Party Committee, and I can't access it.

"Then let's calculate the development area of 12,000 hectares. This data always exists. Although Hainan is a province, the total population is not large, but there are more than 6 million people. According to the housing area of 12,000 hectares, the average per capita is 20 square meters per person. This data is only under construction, excluding the built and the original ones, plus those, in this way, the per capita of Hainan The housing area is at least 40 square meters, am I right?

Tang Tianhong frowned suddenly, "Hainan's per capita housing area has reached more than 40 square meters?" How can this be possible? I remember I saw a data in the party newspaper not long ago, saying that the per capita housing in Beijing is less than 7 square meters. No matter how fast Hainan is developing, it can't be compared with Beijing. If this is really the case, then the bubble in the Hainan real estate market is serious, far more serious than expected.

Tang Tianhao's forehead also sweated slightly. In the past, he only saw the continuous hot situation of the real estate market. As for what Tang Yu said, he had not thought about it before, and naturally he did not calculate carefully. Not only did he not calculate, but also the people who speculated in Hainan did not calculate this account. They only saw the rapid rise in house prices and the resulting high profits.

The area of real estate development and the area of land approved by the government have not been announced by the Hainan government, but the real estate market has been in a continuous boom, so naturally no one thinks about these things. Now that Tang Yu suddenly points to the key place, Tang Tianhao's sweat naturally came down.

As a real estate developer, he naturally knows what it means to have a per capita housing of more than 40 square meters in a region, which is simply the end of developers and banks.

No matter how real estate is speculated, it will eventually be sold to the people. However, now the per capita housing area is more than 40 square meters, which means that a large number of properties will not be sold in the end.

Wiping the sweat on his head, "Xiao Yu, Hainan Province has a population of six million? It's not that you're wrong. How can there be such a little population in a province?

Tang Tianhong said, "It can't be wrong. It should be about 6.5 million yuan. I work in the government and compare digital things **. The data just counted by the country a year ago is about 6.5 million yuan. It won't be wrong. Hainan only became independent from Guangdong Province in 1988. There were fewer people before, and it only increased in the past two years.

Tang Yu remembers more clearly that the real data is 6.558 million. He remembered this thing that made his second uncle almost doomed, and he remembered every number clearly.

Listening to the eldest brother confirm the population figure, Tang Tianhao sweated more on his head, but Tang Yu didn't care about him. "I don't know if my father and second uncle have seen the news when Vice Premier Zhu visited Hainan and Beihai at the beginning of the year. I remember that Vice Premier Zhu Yanshan once said a sentence, which was roughly that Hainan was not as good as what he used to work. In Shenhu City, urban construction should be done according to its ability. This is already obvious. It is aimed at the real estate market in Hainan and Beihai. Isn't this the attitude of the central government towards the abnormally hot real estate market in Hainan and Beihai? It's not that the central government has no attitude, but that many people don't realize it, or don't want to recognize it. When the central government really makes a hard landing of the Hainan real estate market, the end of you developers will come.

At this point, both Tang Tianhong and Tang Tianhao pay attention to it. Although they don't know how Tang Yu, who has been in Dongling, seems to be more familiar with things in Hainan than Tang Tianhao, there is no doubt that his words are very reasonable. Every sentence points directly to the core of the problem. Layer analysis. Tang Tianhong, a former master of economics, connects Tang Yu's words from front to back. It is not difficult to find that there is indeed a bubble in the real estate market in Hainan, but a serious bubble, and he can also understand what his son wants to express.

"I know what Xiao Yu said about Vice Premier Zhu Yanshan's inspection of Hainan and Beihai, but I have no impression of the specific words. I vaguely remember that I was not very satisfied with the results of the inspection in the end. Looking back to the party newspaper, I should be able to find it."

"Uncle, in fact, what you are playing in Hainan now is a game of beating drums and passing flowers, but what you have in your hands is not flowers. Sooner or later, this flower will be rotten in the hands of the last player. On this day, as long as you look at Vice Premier Zhu's recent speech, you will know that it is not far away. Maybe it is today or tomorrow. The bubble in the real estate market has reached this level. The per capita housing area is several times that of Beijing. This kind of bubble is simply bursting. As long as the country tightens the money to control the total scale of credit, there is no room for resistance to you developers. At that time, you developers will suffer.

The more Tang Tianhao listened, the more uncomfortable he felt, and the sweat on his forehead increased. Unexpectedly, the boy who had always only knew how to learn could see so many things and didn't know where he got the data. He looked at Tang Yu and turned his head to look at his eldest brother Tang Tianhong.

"Brother, what do you think?"