property bubble

The International Monetary Fund warned China that it remains concerned over the property bubble in the country. The prices in many cities remain high even though Beijing has introduced higher inflation rate.

Chinese government undertook some measures to cool the real estate sector by having reduced transaction volumes and property price increases, but still in some larger cities prices still look “bubbly,” said Nigel Chalk, IMF mission chief to China.

According to an official statement from China Securities Journal, China must tackle its property bubble for the sake of economic health and social stability, even if the market feels some short-term pain in the process.

As the Journal reported, monetary restricting, along with steps to control housing demand and expand supply, are the right policy choices for the government.