That sent residential real estate prices soaring 68 percent in the first quarter of this year compared with the same period in 2009, pushing mainland China past Hong Kong as the world’s fastest-appreciating housing market, says London-based property adviser Knight Frank LLP. Beijing’s skyline has shot up along with prices, leaving it with many unoccupied see-through buildings. In the central business district, 37.5 percent of office space was vacant in the second quarter, according to Chicago-based property advisory firm Jones Lang LaSalle Inc。

　　“This is a serious bubble,” Xie says. “The alarm bells are ringing。”

　　Kenneth Rogoff, a Harvard University professor and co- author of “This Time Is Different,” (Princeton University Press, 2009)， a book that examines financial crises during the past 800 years, already sees signs of turmoil in China’s housing market。

　　“Property prices are starting to collapse,” he says。

　　Barclays Capital and Standard Chartered Plc analysts forecast a falloff of as much as 30 percent in China’s big cities in the second half of 2010 compared with those of mid- April。

　　Double-Dip Recession

　　If China’s real estate takes a dive, so will its economy, analysts say. Property investment and related industries make up about 20 percent of the country’s gross domestic product, Citigroup Inc. research shows. The economy, which expanded 10.3 percent in the second quarter, may slow to 5 percent in the third period if housing plummets, says Jim Walker, chief economist at Hong Kong-based Asianomics Ltd。

　　The slowdown would reverberate throughout Asia and beyond, especially to countries that supply iron ore and other commodities that have fueled China’s boom。

　　“Commodity suppliers such as Australia and Brazil will be hard hit,” Walker says. “They are incredibly China dependent. It could result in the double-dip recession people are talking about。”

　　China’s economic rulers moved earlier this year to engineer a soft landing. In April, China’s cabinet, led by Premier Wen Jiabao, began imposing stringent restrictions on lending to curb speculation, particularly on luxury dwellings。

　　Housing Soars

　　Officials raised down-payment requirements and interest rates on housing purchases, boosted the proportion of deposits that banks must hold in reserve and, in Beijing, banned families from buying more than one new home。

　　The measures cooled the economy after it grew at a sizzling 11.9 percent pace in the first quarter. Housing prices, which jumped a record 12.8 percent in April, eased to 11 percent in June。

　　While Zhang says government managers will prevent a crash, she would prefer they let the market dictate demand. Unlike most of her rich Chinese peers, who keep a low profile to stay on good terms with officials, Zhang has been very public in her criticism of government policies。

　　“The market should be making the decision to buy or not to buy, not be told by the government,” says Zhang, who lives with her husband and two sons, ages 10 and 12, in a 32nd-floor penthouse in her Jianwai Soho development in Beijing. “The government is very sensitive to public opinion and that’s why people like us have the responsibility to talk honestly about what is happening. That would hopefully help to get the truth to the decision makers。”

　　Rupert Murdoch

　　The English-speaking Zhang, who regularly appears in Beijing’s society magazines, brings a Western style to the way she does business. During the 2008 Summer Games in Beijing, Zhang and Pan entertained fellow billionaire Rupert Murdoch and his wife, China native Wendi Deng, at a celebrity party -- attended by bankers, movie stars and the media -- at a resort they built with the help of 12 architects next to the Great Wall of China. An inveterate blogger and user of a Twitter-like service, Zhang, who calls herself a soccer mom, praised Spain’s “perfect” defense in a post following its World Cup victory in July。

　　Fiberglass Pigs

　　Zhang’s company headquarters in the Chaowai Soho building looks like a Silicon Valley tech firm. Casually dressed engineers, architects and salespeople bounce around ideas in a communal coffee bar decorated with a sculptured herd of life- size fiberglass pigs。

　　“Many Chinese companies are run like military camps with military discipline,” Zhang says. “We do not run a company that way. It does not help the creative process。”

　　Pan, 46, the slim, balding and bespectacled chairman of Soho China, says his wife’s relaxed management style only goes so far. Zhang, the chief executive officer of Soho China, enforces its corporate culture with the determination of a Communist Party cadre, Pan said through a spokesman in an e- mail。

　　“Zhang Xin’s personality, value system and educational background are just like our own personal Central Commission for Discipline Inspection,” Pan jokes. He wasn’t available to be interviewed in person。

　　Natural Experimentalist