China Daily is running a piece entitled "China's housing prices may fall sharply":
The Beijing Academy of Social Sciences expects a "slump" in housing prices once 50,000 low-income housing units (currently under construction) come to market. I assume they are refering to Beijing, not all of China, because otherwise 50,000 would be a ridiculously low number. Even for Beijing, a city of >10 million, 50,000 apartments doesn't sound extreme. But the article goes on to argue that the average Beijing family only has a disposable monthly income of 600 € (note: Chinese families are usually double-income), and as a 100 sq.m. apartment costs 150,000 €, only rich people can afford to buy. The article also claims that 1/3 of all housing space (>10 mio. sq.m.) is currently vacant - though that sounds hard to believe: It would translate to total housing space of only 3 sq.m. per person (based on a city of 10 mio. and 30 mio. sq.m.). Presumably, they are referring to a subset of residential property (excluding most existing low-income housing).
The article also cites a Sina.com poll, according to which 71 % of 12,400 respondents expect a drop in property prices. Maybe not a representative poll, but if that's the prevailing mood, it's not a good sign: More than anything, Chinese real estate investors are speculators hoping for value appreciation. If people don't expect prices to rise, they will not buy.
And this article is downright bizarre:
According to the Chinese Realtor Association, the new high-speed train linking Beijing and Taiyuan (Shaanxi) will give a boost to Beijing's sluggish real estate market. Apparently, there are lots of rich coal mine owners in Shaanxi, and a high-speed link to Beijing makes it more attractive for them to buy Beijing real estate because of the "developed cityscape and education opportunities for their children". So a train service which reduces travel time from 8 hours to 3 hours will lead to a flurry of buying activity from wealthy Shaanxi entrepreneurs? Sounds like clatching at straws to me. The situation must be really bad if the Realtor Association can't find a better reason for a market upturn than this...