Turbulent times ahead for property market

Of a statistical pool of 100 major Chinese cities, 85 saw year-on-year drops in new home prices in December, according to figures from the China Index Academy. Data also showed prices dropping 0.44 percent month-on-month to an average of 10,542 yuan ($1,686.72) per square meter, marking the eighth consecutive decline of its kind.

These results come on the heels of a slight rebound in November which many pinned to the cancellation of purchasing and lending restrictions. At the time, some believed the market had stabilized under policy supports from central authorities. In hindsight, that rebound looks short-lived.

Home prices have long exceeded the purchasing power of ordinary buyers. Correcting this imbalance won't be achievable through government intervention alone.

Some predict that authorities in first-tier cities - Beijing, Shanghai, Shenzhen and Guangzhou - might cancel their purchasing restrictions soon. If so, home prices could find more room to fall. Many believe such a step would signal serious market distress.

Meanwhile, a continued upturn at local stock markets could pull more funds out of housing assets. Observers will also be watching the development of housing registration policies, which could force some to offload their real estate holdings.