While you’re technically correct about the government leasing property, in practice buying the rights to land for residential use is in practice effectively the same as buying the land. There are a lot of things like that in China, where the system is nominally socialist, but in practice things are just as capitalistic (if not more so) as they are in western countries.

This hasn’t been tested yet. There was a huge scandal in Wenzhou when the local government was going to charge market prices for renewing leases there (their property market started earlier with shorter leases before 70 years was settled on nationally). The central government had to step in and make the leases turn over automatically, because the precedent set in Wenzhou could tank markets nationwide.

I bet China eventually scraps the lease system and replaces it with a universal property tax, which would solve the other problem of keeping local governments funded long term (right now they just make money on sales), while naturally deprecating the property on a yearly basis, and also making pure speculation much more difficult.

But who can say. If china switches to a property tax system (not just the nominal one easily gamed in shanghai and chongqing today), it would break a lot of buying assumptions.

That’s well and good, but my point remains: There simply isn’t enough long run evidence of predictable outcomes.

I have some confidence of this if I purchase property in a Western jurisdiction, but in China the situation is a bit more fluid. I have zero leverage and have no doubt I would get trampled if convenient.

This is the perception they have to overcome, and to be honest, I don’t think they care to; do they really need or want my capital invested in China, especially in property?

Signals from ruling class appear to indicate otherwise.