Nowadays the stock market in Shanghai is hot, the real estate market is not. This Chinese article says in year 2006 the Shanghai housing price dropped about -0.5%. While not a significant drop, this plus the recent raise of interest rate makes potential home buyers weary. But I think the buyers need not worry if they know what they want, do the homework, and plan to stay for long term. There are still bright spots in the real estate market. Among those there is one bedroom apartment close to metro stations: the influx of college educated workers like to rent those apartments so that they can get to work, and enjoy the urban living style. Read this Chinese article if you are interested.
I searched ehousee (Jinfeng Yiju) and found this one near where I am living now. They asked CNY 500,000 for 40.9 square meters one bedroom apartment. These can be rent for CNY 2,000 monthly. So the investment can be paid off in about 20 years (250 months), assume the rent stays the same and no appreciation for the property. Not to mention the appeciation of Ren Ming Bi 🙂
Maybe a safer way to play the China card without losing your sleep (I mean, the ups and downs of the stock market)?