Strains building up for China property market
Published on Jun 1, 2014 3:14 PM
BEIJING (AFP) - After years of boom that have seen prices rocket, the prospect of a bust is looming over China's vast property sector, with authorities hoping to avoid a meltdown that could send shock waves through the world's second-biggest economy.
Housing was doled out by the state when Communist-style collectivism dominated economic management. But in the past two decades that has given way to market-oriented principles as China's economy has opened.
New home prices have soared, more than quadrupling in Beijing and Shanghai since 2003, and more than doubling in the country as a whole, according to a report by Jeremy Stevens, Beijing-based Asia economist at South Africa's Standard Bank.
The increases have been a key source of wealth for China's rising middle classes, and a major driver of the economy.
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