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'Inflection point theory' reignites controversy
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Recently at a real estate industry ceremony, Wang Zhongming, the director of the Economy Research Center of the State-owned Assets Supervision and Administration Commission, denounced the recurring "inflection point theory", by saying, "It's too early to comment on the so-called inflection point for real estate; it would be misleading the public." 

Lots of journalists have already reported that "housing prices are going down" and "the inflection point has arrived", but Wang said this is severely underestimating the hardships associated with macro-economic controls.

However, Chen Gang, the deputy mayor of Beijing, said in a recent interview that he has confidence in the upcoming "inflection point". He also expressed his happiness for the drop in formerly rising housing prices, asserting, "It's good news." Feng Lun, the Chairman of the Chinese property giant the Vantone Group, said that the real estate industry has entered a market structure adjust phase, according to recent policies and subsequent market responses.

Wang Shi, the Chairman of another property giant China Vanke Co., Ltd., is the first man who raised the "inflection point theory". He said in an interview with yesterday that concerning the "inflection point" he thought that housing prices would return to reasonable positions. At the same time, he suggested that a man should rent houses until he's 40 years old before determining his final career. He also advocated that young people should rent houses before buying even when they plan to marry.

As the government insists on controlling the property market, currently more research institutes are expecting a stable increase of housing prices in 2008, amid the relative declines of anticipations, along with a partial overdraft of purchasing power and some big drops in trading volumes.  

For more details, please read the full story in Chinese. (

( January 29, 2008)

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