Chinese trainChinese property developers backed by Wall Street are successfully raising billions of dollars to rescue investments that were on the precipice of collapse, in today's WSJ story: Chinese Developers Race to Launch IPOs.This begs two questions: (1) Why is Wall Street doing this? (2) Why is this not happening here in the United States?Here is a big clue:"A huge amount of the lending related to China's economic stimulus has found its way into real estate," allowing developers to restart projects that were languishing as well as making it possible for potential home buyers to get mortgages, says Peter Churchouse, a property investor in Hong Kong.The Chinese government invested significant money in developing property and infrastructure. Their efforts to facilitate home-buying were on a far grander scope than paltry American efforts to encourage first-time homebuyers on a limited basis. The closest we have come to a grand plan was Martin Feldstein's unimplemented suggestion to have the government work with lenders to modify loans and reduce principals.The Chinese are able to encourage resettlement in certain areas because it is investing significant sums in its infrastructure. It is also developing a network of high-speed trains to connect cities with soon to be major cities. When China finishes its high-speed railroad in 2020, its 16,000+ miles of track will make it the largest in the world. You can bet that close proximity to a high-speed railroad station will bring more jobs, more people, and a greater demand for housing.Stimulus money could be used to improve our mass transit system in a size and scope that Robert Moses imagined, and China implements, and refinance the growing stock of underwater homes. This would create more jobs, higher occupancies, diminishing vacancy rates, and higher rents. Instead of (or dare I dream, in addition to this), we could populate empty housing and multifamily stock with Chinese...and other immigrants.http://multifamilyinvestor.com/chinese-trains-and-the-american-multifamily-market/
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