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They expect to derive what mortgage experts call "instant equity" from their neighborhoods' rapid appreciation.
A more rapid appreciation could lead to social turmoil, he said.
Those who have owned their homes since the start of the decade became accustomed to a steady, rapid appreciation.
The most immediate difficulty is the rapid appreciation of the rupee against the dollar in recent months (see article).
One is that America may succeed in winning a rapid appreciation, but at the cost of turmoil in China.
Crucially, expectations of rapid appreciation enlarged the set of mortgages that could be originated and sold at a profit.
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Such massive inflows of hot money into emerging markets will have the destabilising effects of rapid currency appreciation and asset bubbles.
Third, to make money from rapid capital appreciation (resale values have also doubled since 2004).Suddenly, all three of these arguments are weaker.
But the renminbi has inched up less than 1 percent since then against the dollar, as China has continued to intervene heavily in currency markets to prevent a more rapid currency appreciation that could hurt the competitiveness of Chinese goods in overseas markets.
There was no bubble; housing prices were rising due to positive fundamentals and not from expectations of rapid price appreciation.
Such rapid price appreciation in U.S. equities led one investment officer to say the rally is "too explosive to be sustainable".
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