China's Housing Boom Gives Birth to an Army of 'Wife Flippers'
Liao Shumin
DATE:  Jul 16 2018
/ SOURCE:  Yicai
China's Housing Boom Gives Birth to an Army of 'Wife Flippers' China's Housing Boom Gives Birth to an Army of 'Wife Flippers'

(Yicai Global) July 16 -- China's property market is bubbling so hard that wealthy ladies are starting to form local social media groups to never miss a good house flipping opportunity.

"Everyone is optimistic about the Blue Diamond Mansions at the intersection of the planned subway line 5 and line 10," Wang Xiangqing told Chinese newspaper the Economic Observer, while peeling an apple for her father lying in a hospital bed. Wang has visited the eastern city of Hangzhou a lot more since her father's hospitalization and got into local ladies' investment tips group that runs via social media application WeChat. Soon, Wang found herself five houses with an investment of nearly CNY10 million (USD1.5 million).

At least one member in the 'wife group' has invested in a sought-after project in each district and is thus familiar with the surrounding facilities and future potential for appreciation, Wang said, adding that the group members are willing to share this valuable information and also enjoy discounts on investments thanks to connections with local project managers.

Appreciation should be a safe bet as China's new home prices have risen consecutively for 38 months, as of in May, when the prices jumped 0.7 percent, showing the fastest growth in nearly a year.

No one knows who started the first house flipping group. One possible option is a 150-member ring from the eastern city of Wenzhou, which landed in Shanghai in 2001 and kicked off its worldwide journey into real estate speculation with a joint investment of CNY50 million. Since then, these digital clubs of the affluent have taken a foothold in China's property market.

Some 100 Chinese cities have tried to constrain their property bubbles with different measures in the past two years. Hangzhou followed two other Chinese cities and stepped up its policy at the end of last month by setting up a restricted area where only private entities can buy housing. The measure was aimed to control speculation that is fueled by corporate investment, but in fact, leaves more room for private investors such as Wang.

Other five cities, including Chongqing, Nanning, Nanchang, Changsha, and Xian, blocked house-sales for three years after purchase last year in order to stop house flippers from inflating the prices.

"Owners of a large number of houses may end up relying on meager house rents," Wang said, while recalling a joke regarding property without much potential for appreciation among the Zhejiang province-based investors. If Hangzhou chooses to follow the five cities' suit and puts time-restrictions on selling, Wang could be left with just that.

Editor: Emmi Laine

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Keywords:   House Flippers,HOUSING PRICES,Renting,Residential Property