Models of new residential developments for sale at a real estate fair in Qingdao in eastern China's Shandong province last month. China may be running out of options to handle a housing slump. European Pressphoto Agency            
China still has ammo left to combat its housing slump. But even the heavy artillery it is holding in reserve may not be enough.
Earlier this week, the country's central bank unveiled a basket of piecemeal measures to support housing. These included encouraging banks to issue more mortgage-backed securities, and allowing more people to qualify as first-time buyers, giving them preferential mortgage terms.
China is in the midst of a serious real-estate correction. Nationwide property prices have fallen by 3.1% from April through September, according to the China Real Estate Index System, a private data provider. That may not seem dire, but it is equal to the previous price decline, over a longer period, between August 2011 and May 2012.
Sales figures are more alarming, with government data showing total housing sales falling 10.9% from a year earlier in the January-August period.
Previous Chinese property corrections were all due to deliberate government policies to rein in the market, including restrictions on apartment purchases at the local and national level. Prices were quick to rebound once the government lightened up on the reins.
This time is different. There was no policy trigger for the latest downturn, and prices have kept sliding even after dozens of local governments have lifted restrictions on property purchases. This suggests the correction is the natural result of a buyers' strike.
Ordinary Chinese seem to have been shaken out of their conviction that property can only appreciate over time, similar to the psychological turn seen in the U.S. in 2007. A recent central bank survey of households found that only 19% of respondents expect prices to go up over the next three months, down from 36% a year ago.
The true test may be yet to come. Beijing could still break out the big guns, by lowering the current down-payment requirements of 30% for first-time home buyers and a punitive 60% for second-time buyers.
But if the public still believes the market has further to fall, even these measures may not succeed in luring them back to the market. The nuclear option is a broad economic stimulus.
That might be the only thing that could bring Chinese housing back—just don't count on it.