Yes, say some experts, pointing to country's riskier credit system
CHINA'S booming economy is making many people rich - and happy.
But experts warn of a possible downside: A property crisis like the one the US is facing now.
Mortgage woes in the US have led to the forced sale of countless homes.
A government economist even warns that China's problems could be worse because its housing loans are riskier.
According to him, many mortgage holders in China borrow by giving false information about their assets and income.
Mr Yi Xianrong, an economist with the China Academy of Social Sciences - a government think tank - said in an interview with the state-run magazine Oriental Outlook: 'I estimate that the large majority of mortgage holders would not meet the standards for even subprime loans.'
He also said that China lacks a comprehensive credit data system, which makes assessing the level of risk difficult.
A price correction is unlikely to happen soon, though, as many consumers there are less concerned about potential economic problems than they are about speculating on property.
PRICES HIGH AND RISING
New flats north of Shanghai's famous Bund waterfront are selling for a record 128,000 yuan ($25,000) per sq m, or more than $2,300 per sq ft.
Typical buyers? Upwardly mobile singles like Ms Li Ruoning, 22, a public relations company employee who borrowed 300,000 yuan from her parents in central China for the downpayment on a 645 sq ft flat in Shanghai.
What's more, Ms Li says she would buy another flat 'as an investment', if she had the money.
The possibility of defaults in Asia may also not be as bad as in the US because in some markets, including China, lenders tend to demand downpayments of at least 30 percent or more.
Singapore and Hong Kong supply low-cost housing and low-interest loans to the poor, which cut the risk of foreclosures, while South Korea has already cracked down on risky mortgages.
None of this may be of help to red-hot China, though.
Warned Mr Zhang Yu, a real estate analyst from Guotai Jun'an Securities in China: 'The government does need to do something fundamental to improve the situation.
He added: 'Tightening mortgage operations iscrucial for avoiding a financial crisis.' -AP
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