The Chinese Economy Is Slowing, But Home Prices Stay Hot

Rising House Prices in China Spark Concern

I like the intro to the article:
Steady Increases Could Provoke Sharp Corrective Action by the Government to Realign Home Prices With Average Incomes
The same exact thing could have been written in 2010, 2011 or 2012. The government has tried and failed at every turn to slow the growth of home prices.

Prices rose an average 6.7% year-over-year in July, up from 6.1% in June, calculations by The Wall Street Journal based on official data released Sunday showed. On a month-to-month basis, the increase in prices moderated slightly.

In a statement, National Bureau of Statistics analyst Liu Jianwei said the continued rise in prices is due to genuine home buyer demand as well as recent land price gains.
Land prices are going up for the same reason home prices are going up. Saying home prices are going up because land prices are going up is a misdirection aimed at moving attention away from the inflationary monetary policy.

A sharp increase in lending in the first half of 2013, combined with a quiet relaxation of strict controls on home purchases in some cities, also played a part in boosting sales and pushing prices higher.

From early 2010 to the beginning of 2013, China's central government tightened property-sector controls, aiming to rein in runaway house prices. But with growth fragile and the real-estate sector a key contributor to demand for everything from steel to furniture, in 2013 policy makers have taken a more relaxed approach.
Blowing an even larger speculative bubble to bailout the rest of the economy is not a good idea.

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