In contrast, the prices of both new and existing homes continued to rise in most Chinese cities in June. Meanwhile,[Hong Kong company registration] data from the central bank showed that the balance of yuan-denominated lending to property developers stood at 13.56 trillion yuan (US$2.2 trillion) at the end of June, up 32 percent from a year earlier.

Moreover, local governments�� income from land sales soared 46.3 percent in the first half of 2013, compared to a 27.5-percent decline in the same period of last year, which indicated that land sales had been the major source of income for local governments.

��The real estate sector runs counter to other industries and people��s stalled incomes,�� said Yin Zhongli, a finance researcher with the Chinese Academy of Social Sciences (CASS).

Real economy hurt

The alluring profit in the property market has worsened the credit shortage in the real economy.

More than 70 percent of enterprises in Wenzhou, a city known as the cradle of China��s private businesses, engage in property investment. High funding costs, rising labor prices and exchange rates have squeezed room for traditional industries like garment and glass manufacture.

The city��s situation is a microcosm [Set Up Company Hong Kong]of the economy as a whole.

In fact, more than 70 percent of China��s social financing went into the property sector and local government financing vehicles in the first five months.

Soaring prices have meant profits for property developers. Out of 35 such firms to have issued performance reports for the first half, 21 registered climbing year-on-year profits. Meanwhile, Chinese cities have seen prices on land bids surge amid the waning effects of curbing measures. Local governments are encouraging land sales.

At Tuesday��s meeting, central authorities [Hong Kong Company Formation]pledged to increase support for the real economy and push people-centered urbanization, while promoting the stable and healthy development of the real estate sector.