Realty boost to economy not good in long run

If the asset bubbles are not deflated, China's economy cannot continue to grow and its financial market will face a huge risk. For example, housing prices in the first-tier and some second-tier cities rose sharply in the first half of this year, which "land speculators" used to their utmost advantage.

The property bubble is largely related to the People's Bank of China's excessive credit expansion. In Shanghai, Nanjing and Xiamen, prices of newly built housing units in June increased more than 30 percent year-on-year, and housing prices in Shenzhen jumped 47 percent year-on-year.

Although an unprecedented real estate boom was seen in the first half of this year with housing sales reaching at 640 million square meters, the year-on-year housing inventory actually increased instead of decreasing. By the end of June 2015, the housing space for sale stayed at 657 million square meters.