As house prices rise, 'wild' theories thrive

But on a more serious note, almost all these ideas appear to fuel the belief that there is no better time to buy a house than now and housing prices will keep rising because of the insatiable domestic demand. They ignore or play down the possibilities of changing market conditions like a rise in interest rates and a tightening of credit that could curb the demand and cause the housing bubble to pop.

The new notion of high housing prices being helpful to the poor, criticized by some Chinese media outlets as being "absurd" and "nonsensical", smacks of black humor because soaring housing prices are now widely regarded as one of the main reasons for the widening social gap in China. While housing prices continue to rise even after repeated government cooling measures, many aspiring homebuyers fear they may never be able to afford a place they can call home.

The controversial ideas of scholars have also reinforced the popular perception that some well-known pundits with close association with business interest groups such as property developers have lost their academic integrity, and in worst cases, become the spokespersons for realty developers.

Former US president Harry Truman once famously said that he wanted to find a one-armed economist, because whenever he asked his economists for advice, they answered, "on the one hand," and "on the other hand".

In real estate circles, blunt and funny one-armed Chinese economists come a dime a dozen, but they often point to the wrong direction.

The author is editor-at-large of China Daily. E-mail: dr.baiping@chinadaily.com.cn

(China Daily 06/27/2013 page8)