Asian Markets: Jim Rogers Warns of a Drop in Sky-High Asian Property Prices

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Shares in Asia closed lower Tuesday. In Hong Kong the Hang Seng Index rose 1% to 21,678 and in China the Shanghai Composite Index added 0.4% to close at 3,247. Japan's Nikkei 225 Index slid 0.8%, ending the day at 10,765.Investor Jim Rogers, chairman of Singapore-based Rogers Holdings and author of A Bull in China, today told Bloomberg that property prices in some Asian cities may fall after rising to record highs. In Hong Kong home prices are at their highest in nearly 12 years, according to Bloomberg's Business Week. Prices in 70 Chinese cities skyrocketed 7.8% in December, rising at the fastest rate in 18 months, while new bank loans there in 2009 were more than $1.3 trillion. In Singapore, sales of private homes also spiked.

Rogers is bullish on the Chinese economy. In 2007 he moved his family, including his young daughter, Happy, there so that she would become fluent in Mandarin, which Rogers believes is the key to her future. "In her lifetime we think it will be amongst the greatest gifts that we can give her ... the ability to speak Mandarin," Rogers' wife Paige told theasianparent.com in an interview. He sold his townhouse on New York's Upper West Side, which on my visit there was covered in Chinese character labels ("chair," "table," "book") in an effort to help Happy learn Mandarin. At the time he told Maria Bartiromo, "If you were smart in 1807 you moved to London, if you were smart in 1907 you moved to New York City, and if you are smart in 2007 you move to Asia."

In Hong Kong today, shares in property developers continued to climb. Sino Land, which has many mainland projects, surged 3.3%, Hang Lung Properties rose 1.4%, Sun Hung Kai Properties gained 1.1% and Henderson Land, the Hong Kong developer holding the record for selling the world's most expensive property, added 0.5%.

In China, real estate companies were mixed, with China Vanke losing 1.3% and Poly Real Estate down 0.3%. Evergrande Real Estate, developer of luxury properties rose 3%.

In Japan, the confidence index showed a decline in Japanese consumer sentiment due to falling wages and severe unemployment. The index had been recovering from a low in December 2008, according to marketnews.com, but the new study shows that while Japanese are still buying durable goods, they are seeking cheaper products and reining in household spending as many fear job security eroding even further in the next six months. Today Panasonic shed 2.6%, Canon dropped 1.4% and department store operator UNY fell 0.7%. After the close, Japan Airlines (JALSY) filed for bankruptcy, after hitting an all-time low of 3 yen at one point during trading.

Carmakers also suffered today after the dollar weakened yet again, decreasing the value of U.S. sales of Japanese products. Honda Motor slumped 2.1%, Toyota Motor slid 1.2%.

Japanese banks also closed lower today as consumer lending rules remained tight. Promise Co. tumbled 9.7%, Sumitomo Mitsui plunged 3.1% and Mitsubishi UFJ fell 2.4%. With numbers like this, it's no wonder parents around the world are pushing their children to learn Mandarin, rather than Japanese.
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