"Guangzhou is the ugly duckling in all of this, but it's arguably the most interesting," says Dillon. The city's old factories and buildings have history dating back to the opium wars.

"There's a lot of hot money sloshing around, and if you are an investor, here or in China, real estate is the cleanest shirt in the dirty laundry hamper."

It is the most viable alternative to the volatile stock markets, the illiquid bond market and zero bank rates, creating tremendous demand, he says.

Recently introduced cooling restrictions, including tightening up on second-home purchases, had failed, which just fuelled the buying frenzy. "There's a perception that you have to buy, a gold-rush mentality, because if they're going to tighten up now, they'll tighten up even more tomorrow," says Dillon.

Like Hong Kong, there is perpetual speculation about the possibility of a collapse. But Dillon believes deeply fundamental demand drives this market, and will do so for decades. The consulting firm McKinsey calculates that, between 2005 and 2025, 300 million will move to the cities, stoking demand for new flats.

The mainland property bull market is not driven by reckless mortgage lending - as was seen in the United States before the 2008-09 credit crisis - and so the property prices are not vulnerable to a collapse in lending. Most mainland properties are bought with cash, without need for mortgages. In 2011, CLSA reported one-third of buyers paid cash for first homes and 53 per cent did so for second homes.

Environmental factors are a bigger threat to the value of individual properties, such as air pollution and water shortages, says Dillon. And sinkholes. This is a major problem in Shenzhen and Shanghai, where drops in the water table commonly see whole buildings swallowed by the ground. And buyers must check that their dream home is not built on a toxic lot, as this is also a common problem on the mainland.

City regulations vary - for example, in Beijing, a foreigner must have paid five years of local taxes first before he is eligible to buy a property. The minimum down payment is 30 per cent. Foreigners can get mortgages from a Hong Kong or international bank with a branch on the mainland, but legal documents will be in Chinese. "It's not like in Hong Kong, where you can sign sale and purchase agreements in English."

There are three categories of property. Pre-1949 houses are more likely to have dodgy plumbing and electrical wiring.

Houses dating from 1949 to 2000 were mass-built for efficiency, not comfort or style. "Generally, anything built in that 51-year period is also in danger of being expropriated for redevelopment and you can't get a mortgage," says Dillon.

Buyers should go instead for post-2000 homes - the newer, the better. "These can be staggeringly good, like some around the Shenzhen container port; they're landscaped, with good upkeep and construction quality."

For first homes, vendors pay a 5 per cent capital gains tax, payable on the difference between the property's purchase and resale prices. A 20 per cent tax is payable on capital gains from the sale of second homes

A bigger issue is getting money out of the country. There must be proof all taxes have been paid and document where the funds came from. Be prepared for lots of paperwork. A nationwide property tax is expected in June next year.