WELCOME TO THE PARTY, PAL: China’s real estate meltdown is battering middle class wealth.

At the heart of the decline in family wealth is China’s real estate meltdown, which having a pervasive effect on a society where 70% of family assets are tied up in property. Every 5% decline in home prices will wipe out 19 trillion yuan ($2.7 trillion) in housing wealth, according to Bloomberg Economics.

“It might just be the beginning of more wealth losses in coming years,” said Eric Zhu, an economist with Bloomberg Economics. “Unless there’s a big bull market, small gains in financial wealth are unlikely to offset losses in housing wealth.”

While China’s official data show just a mild drop in its existing home prices, evidence from property agents and private data providers indicate declines of at least 15% in prime areas in its biggest cities.”

There are more middle-class Chinese than there are Americans of any income. Anything that impacts them negatively is going to have global repercussions — probably largely positive for American consumers.