The recent government measures to cool the red-hot property market will not slow economic growth or lead to a significant rise in the bad debts of lenders, a central bank adviser said on Tuesday.
Li Daokui, a member of the central bank's monetary policy committee, said the tightening measures would in no way dampen real estate investment, a key component of China's economic growth.
"The current wave of tightening measures are aimed to cool soaring property prices, rather than curb realty investment," Li, also a professor at Tsinghua University, told China Daily.
"In fact, we will see that the government will increase land and housing supply in the lower-end segment this year, something that would spur property investment," he said.
In the current round of stimulus-driven economic growth, the booming property sector is largely "a free rider", Li said. "Indeed, there are multiple growth engines for the Chinese economy, for example, the accelerating urbanization drive, infrastructure investment and rising consumer demand."
The Chinese government rolled out a series of measures to cool the sizzling property market, including a ban on loans for third-home buyers and tighter mortgage standards for second-home buyers, after real estate prices in 70 major cities went up by a record 11.7 percent in March.