When we first began to gather data on China, gross rental yields in all categories of Beijing condominiums were above 9%, and gross rental yields for villas in Beijing ranged from 9.5% to 13%. In Shanghai, returns were less stellar, with gross rental yields on apartments ranging from 5.4% to 7%.

Last year, we found that rental yields on almost all sizes of apartments in Beijing were below 2.5%, and in Shanghai below 3.2%. It is hard to escape the fact that prices have been climbing steeply, while rents have not moved much. Until 2008, apartments in most large cities in China had rental yields above 5%, a level which we generally consider 'safe'.

Yields below 3% are a danger signal. The Global Property Guide were the first to warn that a crash was likely in the Baltics in 2007. Then our signal was that yields had dropped below 3%. We gave similar warnings in Dubai.

China however is different. Although the Chinese property market is cooling, a crash in China is unlikely because of the firm hold that the authorities have on the financial system, and there are a raft of measures that the authorities can take very swiftly to encourage people to buy.

However many Chinese property investors are voting with their wallets, and buying properties in other countries. Increasingly this is causing Chinese authorities to try to stem the outward flow of money, and causing host communities to say enough is enough, for instance in Australia and New Zealand.