So much for the expected Armageddon in China’s property market. Only last week there were reports that banks were being told to conduct stress tests against a scenario of a 60-per-cent drop in house prices in some cities. Investors fretted that the authorities knew something that they did not.

In fact, the surprise is how calm things remain. The government reported today that house prices in the country’s 70 biggest cities were flat in July compared to the month before, having fallen 0.1 per cent in June. No signs so far, therefore, of the sort of dramatic price drops that might lead to a slump in investment and put pressure on the banks.

That said, people have been buying far fewer houses since the government introduced a swathe of measures in April to try to cool the market. In terms of floor area sold, transactions fell by 29 per cent in July from the month before, with many buyers remaining on the sidelines.