China's property bubble has burst - report

Economists at Nomura have made their call: China's property bubble has burst, they say, and the country's economy could slow dramatically unless Beijing steps in with new stimulus measures.

"It is no longer a question of 'if' but rather 'how severe' the property market correction will be," three of the bank's analysts say in a new report. "We are convinced that the property sector has passed a turning point."

Analysts at the Japan-based broker are among the most critical of China's property sector, which has powered ahead for years despite frequent warnings that a collapse is just round the corner.

Skeptics say the real estate sector is emblematic of problems such as rapid credit expansion and policies that promote short term growth over a more balanced economy. The building rush means property supply now outstrips demand in some parts of the country.

Bulls counter that the boom is sustainable, especially as hundreds of millions of Chinese migrate into urban areas.

The size of the sector -- somewhere between 15% to 25% of the economy -- underscores the importance of the debate for a world that is increasingly connected to China.