Pan Shiyi issued: My reflections

He said that in the past few days, when gathering with friends, the conversation always turns to major developments brought about by real estate; the losses caused are calculated in the trillions, and the entire industry is nearly on the verge of collapse. The pain this has brought to countless families and to society as a whole may take years or even decades to slowly ease.
1. Industry root causes: an inherent imbalance in the model
1. From welfare housing to commercial housing: Drawing on the Hong Kong model but going awry, rules such as shared-area allocation becoming distorted, sowing hidden risks for the industry.
2. Uncontrolled mortgage leverage: The down payment ratio gradually relaxed from 50% to zero down payment; improper operations such as installment down payments, “yin-yang” contracts, and fake transaction records have run rampant, and leverage risk has been amplified without limit.
3. The pre-sale system and “land banks”: The pre-sale system allows developers to “sell before building,” diverting funds; the land-bank model drives developers to stockpile land, while the government becomes dependent on land finance, forming a distorted community of interests.
2. Industry distortion: deviating from the essence and spiraling out of control
1. Twisted competitive logic: The industry has shifted from “building good homes” to “competing on leverage, competing on land acquisition, competing on scale.” High debt and high turnover have become the norm, and financialization has departed from the essence of living.
2. A malignant cycle in the ecosystem: Developers keep the business running by relying on pre-sale funds and “borrowing to repay old debts with new ones”; the government drives land prices higher; homebuyers blindly chase rising prices, and together they inflate the bubble, turning into a “drum-passing” style Ponzi scheme in which the torch is passed along—highly fragile.
3. Public opinion and rule constraints: The industry atmosphere only allows people to sing praises; those who question it are treated as outsiders, missing opportunities for early correction.
It’s not a problem of housing prices—it's the entire model that has gone wrong. Pre-sales, shared areas, and land finance step by step push the industry toward the abyss.
A speck of dust from the times falls on countless families, and becomes a mountain.