It would not be an exaggeration to say that China's housing market has proven resilient to both economic downturns as well as regulatory constraints. The key questions to ask are what supports this resilience and whether the housing market will resist future setbacks.

It is admittedly difficult to generalize about China's housing market. China is a large and diverse country and the different regions are at different stages of development. Nevertheless, there are a few common factors that support the long-term outlook of the housing market.

First, China's private housing market is relatively young, having taken off only in the late 1990s. Demand for private housing is yet to be fully satisfied. By some estimates, less than half the demand of white-collar workers has been satisfied, and there is still large unmet demand from both first-time homebuyers and upgraders, which lends underlying strength to the urban housing market.