Major mainland developers reported strong property sales and prices for last month, triggering concern that the country's legislature and top political advisory body might urge Beijing to tighten housing curbs again when they hold their annual meetings next month.
China Vanke, the mainland's largest listed developer, said sales reached 19.7 billion yuan (HK$24.5 billion), an increase of 56 per cent from January last year.
China Overseas Land & Investment recorded year-on-year growth of 273 per cent to HK$14.7 billion.
It was not only big players that saw a bumper start to the year, but also small developers such as Glorious Property, which posted 1.5 billion yuan in sales, up 259.2 per cent from a year earlier.
For the top 30 developers, the average selling price climbed 13 per cent during the last two months of last year, Macquarie Securities said.
Market watchers are now asking how far home prices will climb before Beijing is persuaded to take action to prevent the market overheating again.
Alan Chiang Sheung-lai, the head of mainland residential property at consultancy DTZ, said home prices in first-tier cities registered average growth of 4.4 per cent on a 40 per cent jump in sales last year.
Buying interest was adversely affected by the central government's imposition of a string of cooling measures, including restrictions on buying more than two homes, to curb demand and price growth.
"Sales in January are mainly driven by solid demand," Chiang said.
But property sales in second- and third-tier cities remained stagnant as inventory stocks grew, he added.
Unsold units in Shenyang, Tianjin and Wuhan would probably need 13 to 14 months before they all found buyers, he said.
"In a normal market, it only takes four to five months to digest the unsold units," he said.
Chiang said he believed Beijing was unlikely to further tighten cooling measures but rather "fine-tune" them in the lead-up to the Chinese People's Political Consultative Conference and the National People's Congress next month.
He said policies could be relaxed slightly in second- and third-tier cities in a bid to allow the market to absorb unsold inventory, while first-tier cities would continue unchanged.
"It is unfair to read [too much into] the January figures as the comparison base in 2012 was when the residential sales reached their lowest ebb," a developer said.
"At the same time, the fact Lunar New Year was in January [last year] also contributed to slow sales."
He did not expect sales this month would be a repeat of such big increases as many people returned to their hometowns or went abroad for the week-long Lunar New Year holiday.
Property prices are heading upwards with the China Real Estate Index System's data indicating home prices in 100 cities surveyed posting month-on-month growth of 1 per cent last month to 9,812 yuan per square metre, its eighth consecutive rise.
Sixty-four cities reported price gains, with 38 recording gains of more than 1 per cent, up from 26 in December.