Governments are incapable of fine tuning property markets, warns John Saunders, head of property research at brokerage CLSA. Recent government efforts to dampen the market in Beijing, provincial cities and especially Shanghai will inevitably lead to a much sharper downturn than the government intended, he says.
Shanghai, which has seen the sharpest property rises in the past five years, is likely to go down 30% over the next two years, compared to 20% in Beijing.
The government sees the property sector as the main culprit for the economic overheating, and it will stop at nothing to knock it back, raising the chance of an over-correction, he...
