Beijing Adviser: China's Housing Problems Worse Than in US

Because China combines a potential bubble with the risk of social discontent, the problems in China's housing market are more severe than those in the United States before the financial crisis hit, according to an adviser to the Chinese central bank.

“The housing market problem in China is actually much, much more fundamental, much bigger than the housing market problem in the U.S. and U.K." before the financial crisis, says Li Daokui, a professor at Tsinghua University and a member of the Chinese central bank’s monetary policy committee.

“It is more than [just] a bubble problem,” Li says. “When prices go up, many people, especially young people, become very anxious. It is a social problem,” Li told the Financial Times. (more)