Possibly. If so, what are the implications? Could run up even further, could blow up in a spectacular fashion. See this interview with Jim Chanos, currently short China, from FT.com, 1 Feb 2011.
“China is in a very major property bubble”
“70% of their GDP is in fixed asset investment.” … [and this is NOT from infrastructure development. For instance, high speed rail is only 2% of that 70%.]
“At the peak of the bubble in the US, fixed asset investment was 16-18% of GDP, of which 6% was property.”
[The bubble is affecting tier 2 and tier 3 cities as much as Beijing and Shanghai.]
“Prices relative to incomes are in nose-bleed territories by Western standards.”
“A lot of the property that is being built is not affordable by about 99% of the Chinese population”.
[Interviewer: "So it sounds like a criminal or insane or whatever you want to call it, a total misallocation of capital."]
“One of the bull cases is that this will deflate gently, and that the Chinese economy will seamlessly move to a consumer-led burgeoning middle-class economy… The problem is that consumers are less and less of this economy, as the property bubble has gone on.”
“Anytime you take something that is 70% of your economy and rein it in, history tells us that usually the risks are to the downside… but, who knows, they might do it.”
“The Chinese bankers do see problems, you can see it in their pronouncements.”
“The Western investor is getting a lot of opportunities to buy into this boom, and we’re taking the other side of that trade.”
“There are lots of things that people say about China that, when you examine the data, falls apart”.