Core Insights - The article discusses Jack Ma's recent acquisition of the "One Island East" building in Hong Kong for $925 million, contrasting it with his previous prediction in 2017 that housing prices would significantly decrease in the future [1][3][5] - The current real estate market in China shows a complex picture, with significant price drops in lower-tier cities while prime properties in major cities like Hong Kong remain resilient [3][5][6] Group 1: Market Trends - In 2017, during a peak in China's real estate market, Jack Ma predicted that housing would become very affordable, with average property prices in major cities rising by 12.7% year-on-year [3] - Recent data indicates that median housing prices in third and fourth-tier cities have dropped by 18%, while prime properties in first-tier cities have seen minimal declines [3][5] - Hong Kong's luxury residential prices increased by 3.2% in the first three quarters of 2025, highlighting the resilience of high-end real estate [3] Group 2: Strategic Considerations - The acquisition is viewed as a strategic move for asset allocation, as prime real estate in Hong Kong is considered a "hard currency" amid global inflation pressures [5] - The annual rental yield for top-tier residential properties in Hong Kong is stable at 2.5%-3%, which is higher than the yield on U.S. Treasury bonds [5] - The property will serve as an international business hub for Alibaba and Ant Group, leveraging Hong Kong's legal framework and capital flow advantages for global operations [5] Group 3: Market Dynamics - The article emphasizes the fragmented nature of the real estate market, where different regions and property types behave differently, supporting the view that real estate is not a single market but a collection of segmented markets influenced by various factors [5][6] - The contrasting scenarios in different regions, such as affordable housing in shrinking cities versus high prices in financial hubs, illustrate the complexity of the current real estate landscape [5][6]