Don’t write off housing industry yet

In the past, when China's economy ran into trouble, the central government could typically be counted on to step in and loosen controls on the real estate market. This time around though, things are different.

Although the domestic economy has been losing momentum since the beginning of this year, the government has maintained tight curbs on the property market. In fact, soon after the country's GDP growth rate dropped below 8 percent in July, the government deployed inspection teams to make sure these curbs were still being enforced; a clear sign that the nation's macroeconomic policymakers are trying to wean China's economy away from its dependence on growth in the real estate industry.

Obviously though, China's planners can't afford to completely stifle the housing market. Since the third quarter of last year, when the prices of land started to fall and investment in new real estate projects slowed, many of the country's cornerstone industries - such as steel and iron, coal, petrochemicals and home appliances - have taken a financial hit thanks to sluggishness in the real estate industry.

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