BEIJING: China should immediately halt some of its real estate stimulus policies, or risk inflating a bubble that in its bursting would wreak financial and even social trouble, a central bank newspaper said yesterday.
Debate is heating up in China about whether and how to wind down loose monetary policy and heavy spending, with officials voicing worries about asset price rises but also fearful that the broader economic recovery remains fragile.An opinion piece in the Financial News, a newspaper published by the central bank, said rampant speculation in the country's property market was akin to a time bomb that could threaten future growth.
"If China does not exit its stimulus policy... property prices and the market may go out of control," it said.
Shanghai - Regency Park, Mainland China
China's housing prices have been rising since March propelled by a slew of government measures, from lower downpayments and mortgage rates to tax cuts.
Rising prices have encouraged developers to break ground on new projects, with real estate investment up an annual 18.9 per cent in the first 10 months of the year, compared with a mere 1 per cent rise in the first two months.
Nov24, 2009. - Reuters
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