Kate Zhao is studying business journalism at the Graduate School of Journalism at the City University of New York. She writes in the New America Media:
As the financial crisis in the United States spreads around the world, investors are scrambling for a safe place to dock their money. They can at least find one – China, where a similar financial crisis is highly unlikely for several reasons.
First, slumps in real estate values, which directly triggered the current credit crisis in the United States, aren’t likely to occur in China.
Unlike most countries in the world, in China, the government owns the land. That means Chinese homeowners spend the majority of their income paying for a house on land they don’t actually own. A homeowner simply buys the right to use the land for a certain period of time – 70 years in the case of residential properties.
