A Chinese friend once explained to me that local governments in China have very little ability to tax. Taxes all get sent to the central government and the central government never sends enough back to the local government. The most efficient way for a local government to raise revenue is to turn farmland into developable land and sell it to developers. Many of these empty homes come from such schemes. Obviously some of these developments turn into vibrant communities, but there are some that remain mostly empty and are held by individuals who are speculating that the prices of these empty condos will go up.