End in sight for China’s building boom

An “inevitable” property tax will have severe consequences for the industry, but should benefit the broader economy.
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A Chinese ghost town featured on CBS's 60 Minutes
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<div style="text-align: left;"> A Chinese ghost town featured on CBS's 60 Minutes </div>

China’s property industry faces a bleak future. It is now seen as inevitable that the government will rein in the country’s building boom with a nationwide property tax, which would divert savings away from the real estate market and bring an end to the mania.

That would hurt developers most, but also companies engaged in building materials, resources, construction machinery, high-end consumption and financials all of which have attracted plenty of foreign capital during the past few years, as well as contributing to investment banking revenues.

“We expect a nationwide rollout of the property tax to commence sometime during 2016 to 2017, which should be a major...

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