China’s real estate wealth meets financial storm while Western markets see mortgage rate spike

Quick Take

As one of the largest global wealth sources, the real estate sector continues to demonstrate tremendous growth. According to Statista, it’s projected to hit a whopping $613 trillion in 2023 and potentially reach $700 trillion by 2027. Much of this wealth is concentrated in China, the world’s largest real estate asset class, with an estimated value of $131 trillion in 2023, according to Statista. Yet, a financial storm brews on the horizon for China, as discussed previously by CryptoSlate, with the country grappling with deflation and currency issues.

Simultaneously, a dramatic shift is occurring in the Western markets. As reported by The Kobessi Letter, the rates and yields are on a steady upward climb, with the 30-year mortgage rates touching a 21-year high of 7.5%. This rise indicates more capital being funneled into servicing housing loans, leaving less for economic circulation. Additionally, as properties often represent a significant portion of people’s net worth, the resulting decrease in property values due to rising rates could trigger a reverse wealth effect.

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