At a time when the government is promoting real estate destocking in small cities, the recent surge in property prices in big cities such as Beijing, Shanghai and Shenzhen, presents policymakers with something of a dilemma.

Compared with the tepid conditions in the real estate markets in other parts of the country, home prices and transactions in such first-tier cities as Beijing, Shanghai and Shenzhen have reported a considerable jump over the past year. Shenzhen even registered a nearly 50 percent rise in the prices of newly built homes, with Shanghai exhibiting signs of a similar scenario.

The recent rise in housing prices in these metropolises can be largely attributed to the demand in these cities, which reflects their attractive employment opportunities, unparalleled advantages in terms of educational and medical resources, and possibly people's belief that buying properties can help hedge against the economic headwinds.