Rarely has a State Council directive been so strongly worded. You could almost hear the banging on the table and the shaking of teacups in the background. The question is: will it make a fundamental change to the country's housing market?
I am not going to repeat myself here. Instead, I will pass the microphone to Ren Zhiqiang, the chief executive of state-owned developer Hua Yuan Group. He is not just an insider. He is also a critic. Below are excerpts from Ren's commentary 'This is just the beginning', posted on his blog on Wednesday.
'The truth is the government is not going to give up unless [housing] prices head south ... It is all about politics ... If the upcoming details are more draconian, then a temporary adjustment may turn into paranoia.
'But the market is not going to collapse because the fundamentals of our economy have not changed ... When prices have reached the 'target' level or the market becomes paranoid, the government will reverse the policy.
'The real issue is that suppressed demand will eventually push the market into a serious imbalance and push prices up again. When this happens, is the government going to interfere again?'
Obviously, Ren has zero faith in the new policy of building the so-called healthy property market. Here is why.