The Chinese capital markets are still not developed, meaning the only place ordinary Chinese people can park excess capital is in the stock market or real estate. Thanks to this, property prices have risen disproportionately.
In the past few weeks, reports from the largest cities suggest that house prices are stabilizing or starting to retreat. We'll see if this is a bubble popping.
The Chinese like to manipulate their statistics, like when they undervalued their embrassingly large trade surplus. It's no surprise.
As opposed to Goldman Sachs and AIG, which are world renowned for keeping honest statistics.
