HONG KONG LIVES!
Hong Kong has some notoriety for its property booms and busts, just have a look at the chart, to refresh your memory.
While changes in home prices are scary on the way down, you'll notice that Hong Kong lives. Better than that, they thrive (the stock market is up).
Not everything is the same or parallel (HK's market has some unique structural quirks), but ... you cannot help but wonder if 50 years of rising prices in the U.S. has created an unusually soft psyche on the issue of the resilience of economies in the face of price swings and the value of real-estate, in the long run.
These violent price swings are typical of Hong Kong. The property bubble before the handover saw prices rise 70% (54% in real terms) from Oct 1995 to 1997. Then there was a traumatic burst, coinciding with the Asian Crisis, and property prices fell 44% in one year (Oct 1997 to 1998). From the peak to the mid-2003 trough, prices fell 66% in nominal terms (61% in real terms).
THE FAR SIDE OF THE WORLD ...
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