And internal pressures are also piling up, along with the appreciation of renminbi, rising labor cost, a high rate of inflation, slower economic growth, and deepening of economic restructuring. Besides, more jobs have to be created for new workers, the unemployed and surplus labor in rural areas, according to the report.

Furthermore, the government's property market control has shown initial effects, but more commodity housing needs to be constructed to increase supply, according to the think tank authors.

The Chinese government has repeatedly reiterated its firm stance on property market control and vowed to keep in place tightening measures like bans on third-home purchases and property tax trials, which have been introduced one after another since 2010.

The report points out that the purchase controls have dampened the rapid rise of property prices, but control measures have also led to slower growth in property investment.

It suggests heavier investment in commodity and affordable housing, particularly small and medium-sized apartments, to meet people's demand while curtailing speculation.

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