HMM: China Is Facing Housing Market Disaster.

According to data, China’s property sector is the single largest asset class in the world, as Adem Tumerkan, editor at Speculators Anonymous, told Newsweek. “It’s estimated to be worth over $60 trillion—far more than China’s bond and equity markets combined,” he said.

“When I was still at UBS a few years ago, we used to call it the most important sector in the world,” economist George Magnus, once chief economist of UBS and now an associate at the China Centre at the University of Oxford in the U.K., told Newsweek. “Most people kind of accept that even allowing for a bit of double counting and dubious inclusions, it’s probably about a quarter of [China’s] GDP.”

This is a huge slice of GDP when compared with other large economies. Not only this sector is massively important for China, but it’s also closely tied to the personal finances and savings of Chinese households, as “Chinese people don’t really invest in equities or financial assets,” Magnus said, and the property sector has become “a form of saving for the urban middle class.”

About 70 percent of household wealth in China is tied to the real estate sector, “a massive amount,” according to Tumerkan. “It really emphasizes how dangerous falling home prices can be on household balance sheets and confidence,” he said.

But while prices fall…: China is estimated to have nearly 25% of the entire US building stock under construction right now.

China needs to deleverage from real estate but they keep doubling down, instead.