Recently, various departments in China have introduced policies to suppress real estate bubble. For the hot-spots in the first and second tier cities where the Central Government is unable to control the property price, the local party and government officials will directly start the accountability mechanism. The Department of Land and Resources is responsible for land market management and land supply increase, while the Central Bank is curbing the expansion of the asset bubbles by adjusting the credit policy. Anbound research team believes that the decision-making authority’s concern on the problems caused by property price’s grim trend has increased to the level of stabilizing the situation, and this has also become a major political and economic issue before the 19th National Congress of the Communist Party of China. Taking into account the current round of property market inflation is largely due to policy stimulus, following the introduction of controlling combination measures like expansion of supply, strengthening of regulatory and tightening of credit, it is likely that the property price increase in the hot-spots of first and second tier cities will be contained, but whether this will reverse the market’s expectation is depending on the market players and government regulations.
