Illustration: Lu Ting/GT

According to data released by the National Bureau of Statistics last week, new commercial home prices in 69 out of 70 major urban markets were up in November from a year earlier. Once again, first-tier cities were at the front of the charge - prices in Shanghai, Beijing, Shenzhen and Guangzhou were all up more than 20 percent.

Outside of China's perennially frothy first-tier segment, urban home prices across the country as a whole have risen at a relatively moderate pace this year, according to industry data. Indeed, conditions look positively tranquil when one looks back to 2010 and 2011, when major policy curbs were rolled out to contain rapidly surging home prices.

It's almost impossible to overstate the role of real estate in contemporary China. The property sector keeps government coffers filled and soaks up output from dozens of pillar industries. The development of China's private housing market has also raised living standards for hundreds of millions of ordinary citizens. And for millions of other prospective buyers, there's no shortage of research institutions and industry groups ready to supply them with up-to-the-minute pricing data and market projections.

However, most of the statistics seen by the public are based on figures gleaned from government data portals. Unfortunately, these sites may not always be the most accurate barometers of China's real estate market.

Under current regulations, local housing authorities regularly supply developers with guidance on where to set their prices. In order to sell their properties quickly, developers typically comply with this guidance, at least when it comes to registering their prices on government websites.

In practice though, developers have been known to sell their properties at much higher prices in the market. Actually, it was reported in October that some home buyers in Guangzhou were asked to sign two contracts - one with a fake price to show the government and one with the real sales price for the buyer to keep.

Although it's hard to determine just how large this phenomenon has become, developers are needlessly muddying the waters with such behavior. Worst comes to worst, they may provoke even tighter curbs from officials. Such a development may do more harm than good, especially since the market is naturally approaching the state of balance that policymakers have long been so desperate to achieve.

China's property market can be roughly divided into three levels: high-, middle- and low-end. At the high end, one finds detached villas and luxury apartments. Many people who buy such homes are wealthy and regard these properties more as investment vehicles than places to live. But sales of such homes - which have historically accounted for a relatively small portion of overall transaction volumes - are beginning to wane now amid concerns about China's weakening macroeconomic environment. With fewer big-ticket sales to skew the market, developers are now focusing on the real demand coming from the next rung down.

In the medium-end segment, millions of middle-class buyers are hoping to parley their rising incomes into a comfortable home for themselves and their families. With the spread of urbanization across China, cities are expanding and accumulating more wealth. In the process, they are also laying the foundation for continued mid-segment growth. This alone should give the property market the momentum it needs to keep growing steadily through the decades to come.

At the lower extreme of the housing market though, things become more complex thanks to a variety of factors; including differences in regional development, migration patterns and grey markets for rural homes. In general though, the market for low-end homes is relatively stable thanks to government subsidies and social support policies.

In other words, additional policy interventions on the market are no longer needed, especially when it comes to the high- and medium-end segments. Adding further control measures may only hurt real buyers and dampen economic growth. If planners act at all, they should continue to prop up the bottom end of the housing market. This would give the mid-tier market a pressure release valve and help low-income buyers gain a stronger foothold in China's transitioning economy.

The author is the chief research fellow with Beijing-based private strategic think tank Anbound. bizopinion@globaltimes.com.cn