China to invest $200bn in low-cost homes to curb prices

China's economic success has seen a huge spike in demand for property pushing up prices.

China will build 10 million low-cost homes this year at a cost of $200bn (£124bn), a government minister has said.

The move comes as soaring home prices spur complaints about affordability.

In January, prices of new homes rose in 68 of the 70 cities monitored by the government compared to a year earlier.

The spending is a part of a commitment to construct 36 million low-cost homes over the next five years.

'Postpone purchases'

The huge spike in property prices has also raised concerns about a property bubble being formed.

Authorities are worried that if not controlled, speculators could drive prices even higher.

"One of the key points we are trying to control, is to postpone purchases by those consumers who don't need to settle down and buy houses urgently," Deputy Housing Minister Qi Ji said.

The regulators have already introduced measures to that effect. They include raising down payment requirements and curbing lending on purchase of second homes.

Cities like Shanghai and Chongqing have imposed a property tax to reduce profits for sellers.