BEIJING, Nov. 21 (Xinhua) -- China's property prices are likely to decline almost 20 percent next year starting from March or April, according to a report issued by the Beijing-based Renmin University of China (RUC).
Meanwhile, Liu ruled out a steep correction in the nation's property market, saying that tight financial situation will not cause a sharp price plunge and the market is expected to realize a soft landing.
The problem with a soft landing call is the prices quadrupling was speculator driven in the first place. Speculators, once the market falls even 5-10%, are wiped out. Broke. They cannot form a floor in the market to keep it from falling farther. The floor will be formed only when investors looking for rental properties and future owner-occupiers step in and start buying and they won't step in until price to rent ratios and price to income ratios return to rational. Guess what, that's a long way down from a 20% "soft landing". A heck of a long way.