The Chinese economy expanded at an annual rate of 6.7 percent in the third quarter, in line with the government’s full-year target, but exacerbating fears of inflated corporate debt levels and overheated property markets. Many analysts believe this year’s better than expected growth in China has been the byproduct of a dangerous expansion in credit, especially for real estate developments and state-backed infrastructure projects. “Credit growth continues to outstrip nominal GDP growth, building on an already enormous base of outstanding debt,” said Eswar Prasad, a China finance expert at Cornell University. “The cost of hitting short-term growth targets is becoming a rising burden for the financial system, with stresses periodically erupting in different parts of the system. The housing market is the latest pressure point.” More than 20 urban governments across China have recently introduced measures to restrain house prices, which over the past year have increased by as much as 25 per cent in cities such as Beijing and Shanghai. Analysts believe the sector accounts for more than half of all investment, after factoring in demand for everything from concrete to household goods.