China's largest city Shanghai may be facing a devastating real-estate bubble as housing prices soar far beyond most local residents' means, state media said Sunday.
Investment in real estate increased by more than 50 percent in the first six months of the year, the Xinhua news agency reported, citing a report from the Shanghai Academy of Social Sciences.
Most newly-built houses and buildings were far too expensive for the majority of local buyers, having experts worried that supply may eventually exceed demand, Xinhua said.
For example, a downtown apartment costs at least one million yuan (US$120,000), one hundred times the annual average disposable income in the city, the report said.
In a sign that new housing may be out of most local residents' reach, only 30 percent of the buyers of expensive houses in the first half of the year were from Shanghai, the report said.
Shanghai land prices have doubled over the past seven months, as real estate companies from around the country rush to the city, Xinhua said.
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