THE shrinking transaction volume of homes coupled with the "wait-and-see" sentiment currently found in some parts of the country won't necessarily lead to a "turning point" for house prices, the Chinese Academy of Social Sciences said over the weekend in its annual industry blue paper.

As a result of tougher macro-control policies introduced to curb the overheated domestic real-estate market, growth of home prices will be rather insignificant this year compared to that achieved in 2007. That's the conclusion of a blue paper titled "China Real Estate Development Report," compiled by the Urban Development & Environment Research Center under the academy.

"Massive bearish sentiment, which usually indicates a continuous downward trend in housing prices lasting for three to five years, is not expected to occur in China at the current stage," said Niu Fengrui, the UDERC head. "In fact, chances for the coming of the real 'turning point' for the country's real estate industry are also small, even over the coming few decades."

Industry experts believe demand for residential properties, fueled by the country's rapid urbanization process, people's desire to improve their living standards, and relocations caused by large infrastructure projects and urban development plans, will remain robust. These will serve as the fundamental reasons for a long-term shortage of homes in the country, the experts said.

Zhu Zhongyi, vice chairman of the China Real Estate Association, echoed the point that it is normal for housing prices to fluctuate in some parts of the country for some time.

Uncertainties in the global economy together with continuous expectations for yuan appreciation are expected to divert a big amount of overseas capital into China's real estate market and help lift prices.

Cooling measures