Long-term measures

Such long-term policies include introducing real estate taxes, land reform in rural areas and increasing housing supply, especially affordable housing, Zhu said.

According to a research note by J.P. Morgan, the State Council announced it will start building 36 million units of affordable housing between 2011 and 2015. Based on official announcements, between 2011 and 2013, 24.9 million homes were started and 15.8 million homes were completed. The Ministry of Housing and Urban-Rural Development announced that the 2014 targets were 6 million units new starts and 4.8 million units for completion.

"The ambitious affordable housing project could be the game-changer in the coming years," said Zhu.

For Wang Rongwu, deputy head of the Beijing municipal commission of housing and urban-rural development, if the housing problem of low- and middle-income families is properly addressed, the prices of high-quality commercial housing will be decided by the market in the future.

At the Third Plenum of the Communist Party of China's 18th Central Committee in November, the Party pledged to let markets play a decisive role in allocating resources as it unveiled a reform agenda for the next decade.

A more decisive market role has become visible in many areas.

For instance, Wang Huamin, a member of the CPPCC Beijing Municipal Committee, put forward a proposal to reform Beijing's subway ticket pricing policy.

"In the short term, the government should raise subway fares to 4 yuan during the rush hour on work days and keep the price at 2 yuan during off-peak hours. In the long term, I think a refined system of ticket pricing should be established to provide different options for passengers, including an annual card for peak times, an ordinary annual card and a seasonal card."

Beijing's current flat-rate subway fare of 2 yuan, which allows passengers to ride on any line and make transfers, is even cheaper than 15 years ago, when it was first increased to 3 yuan in 1999. The fare was reduced to 2 yuan in 2007 to encourage public transportation and ease road congestion.

The more decisive role of the market also involves areas such as interest rate liberalization, moves to remove administrative barriers to private capital and other forms of financial liberalization.

However, such a process cannot be accomplished in one stroke.

When industry insiders all agree that a long-term mechanism should be established, the ending of administrative measures, it will not be easy to phase them out in the short term.

According to Liu Xiaoguang, chairman of Beijing Capital Group, it is a bit difficult to let the market play a decisive role in the property sector in the short term, especially in first-tier cities such as Beijing and Shanghai.

Chen also stressed that in Beijing, the policy to restrict the number of homes a family can purchase will continue. And the mortgage policy to prevent investment-oriented purchase will also persist.

Currently, a family with a Beijing hukou (full right of residency) is allowed to purchase no more than two apartments. The down payment for a second homebuyer is 70 percent with an interest rate of 1.3 times the benchmark interest rate.

Ren Zhiqiang, chairman of Huayuan Real Estate Co Ltd, said he hoped there will be a more clear-cut of the division of labor between government and property developers. If the government can do a good job in ensuring housing for middle- and low-income families, then the market could play a bigger role in allocating resources and deciding prices, he said.