Is China's Property Market Heading toward Collapse?

China's property market has slowed more than expected, leading to fears that the Chinese economy faces a hard landing, even a financial crisis, comparable to Japan's two decades ago. However, it is premature to compare the Chinese property market now with the Japanese property bubble and collapse in the early 1990s, or the US housing market collapse in 2008. China's continuing urbanization, available policy options, and the stage of its property market development all suggest that China's property market is experiencing simply another cyclical adjustment. Indeed, the current slowdown could catalyze the phase-out of outdated and irrelevant policies and accelerate necessary institutional developments in China's property market.