Running Up the Score

Since the beginning of real estate reforms in 1998, the most fortunate people and well-paid professions in China have been involved in real estate development and investing. Developers lock down a plot of land, governments sell and investors buy, and all turn a profit.

If we see it as a soccer match, the real estate industry enjoyed a great first half over the last few decades, marking a score of 5-0. Its success in the first half, however, cannot be attributed to skill, but rather to two aspects of real estate policies. One aspect was the logic behind the goals of regulation, and the other was the methodology of regulation. Both, however, were misplaced.