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China faces its first real estate crash. That’s the sobering conclusion of Jamil Anderlini’s report in Wednesday’s FT on the country’s property market. After a four-year boom in which official data show prices doubled, the signs of a “looming Chinese property bust” are multiplying.

The article appears on the same day as the Conference Board, the US research group, forecast a steeper-than-expected economic slow down for China. The news helped push the Shanghai stock market down nearly 1 per cent to its lowest level for nearly three years. Grim.

Anderlini’s report includes some startling numbers: 80,000 property developers own enough land to build nearly 100m flats; together with the existing vacant flats that’s enough for 20 years; and property construction accounts for 13 per cent of GDP, so if property slumps so does the economy as a whole.

Meanwhile the Conference Board said its widely-watched leading indicator index dropped 0.1 per cent to 160.1 in October, after a 0.4 per cent rise in September. Andrew Polk, a Conference Board economist, said in a statement: “The risk of a more substantive slowdown in China’s economic growth than anticipated so far is rising.”

China’s expansion slowed to 9.1 per cent in the third quarter, the least in two years, after the government raised interest rates, tightened credit and expanded property-market curbs. While it has now started loosening, with the first cut in bank reserve ratios since 2008, the effects of the previous tightening have spread through the economy.

Chinese economic officials on Wednesday ended their annual policy-setting conference by pledging to maintain growth despite “an extremely grim” global outlook for 2012. “Looking into next year, the trend in the global economy on the whole is grim and complicated. Uncertainties are rising around a recovery in the world economy,” said a statement published on Xinhua, the official news agency, according to Reuters.

The policy-makers promised to keep monetary policy “prudent” and fiscal policy “pro-active”.

The steady-as-she-goes approach is no surprise, given that Beijing is not expected to repeat the big stimulus launched in the 2009 crisis and that the country faces a change of leadership next year with many top officials, including both president Hu Jintao and prime minister Wen Jiabao set to retire.

Somehow it doesn’t sound like a good time to buy an apartment.

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