Real Estate report

For those of you who missed this report on real estate in china!!
You can calculate the ratio ( rent to price) for any area based on this and see where that place stands .
"The ratio between house prices and rental rates in several of China's leading cities has soared well above levels that often indicate a property bubble, the Xinhua agency said on Saturday, quoting an official study.

The report from the Chinese Academy of Social Sciences said the price-to-rent ratio for second hand homes had crossed the danger line in large urban centers including Beijing, Shenzhen, Shanghai and Hangzhou.

The ratio measures the rent for 1 square meter of floor space divided by its sales price. The lower the ratio the more healthy the housing market, Xinhua quoted CASS researcher Shan Jingjing saying.

An increase in house prices not matched by a rising rental market can signal an unsustainable price spiral, the researcher said.

"The international warning line is 1-to-200. Once the ratio goes over the line, the market is in danger of a bubble," the report quoted Shan saying.
In the downtown areas of the four cities Xinhua listed, however, the ratio had already reached between 1-to-270 and 1-to-400, the report added.
CASS earlier this year urged Beijing to tighten its credit clampdown on the country's property sector to prevent the sort of real estate bubble that crippled Japan's economy in the 1990s"

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