Market needs gradual drop in realty prices

There is no need to cite statistics to show housing prices in China's big cities have been too high for ordinary people to afford. Just ask people around you if they are financially strong enough to purchase a new apartment in Beijing or Shenzhen, and most of them will shake their heads suggesting "no" and might even stare at you as if to ask in response, "why do you ask such odd questions?"

The country's top leaders are aware of this reality. And that's why during the recently concluded Central Economic Work Conference they issued a warning, "homes are for residential use, not speculation".

According to a statement released after the conference, China will take highly targeted measures to achieve the goal of "stable and healthy development of the real estate market". For example, monetary policy will be properly managed, monetary flows into speculative housing purchases restricted, land for construction in cities with very high housing prices increased, and the rental market encouraged to expand to meet the housing demand of people who don't own an apartment.