An important news conference for the two sessions was held in Beijing. It’s the final ministerial level press conference featuring the Chinese housing minister.

The minister of Housing and Urban-Rural Development Chen Zhenggao indicated the market will continue to experience steady development and won’t collapse as Japan’s did back in the 1990s.

CCTV’s Yang Chengxi reports.

After a year-long decrease in home sales in 2014, China’s real estate market has experienced a rebound since last year. The sales area increased 6.5 percent and sales volume was up more than 14 percent by the end of 2015. Officials from the Ministry of Housing and Urban-Rural development said during a press conference that the market is warming up. But challenges are also looming.

Clearing out excess capacity remains the ministry’s priority. Its experts said the process will likely take as much as five years according to the current pace. However, recent home price increases across China’s first and second-tier cities are adding an extra layer of difficulty to the uphill battle.

While the ministry works to keep prices stable in big cities, smaller towns are finding their inventories hard to sell. The country’s inventory level reached 718 million square meters (277 square miles) by the end of last year, up 15.6 percent year to year.

Officials, however, said they are confident that the excess can be digested, given the Chinese economy is expected to grow 6.5 to 7 percent this year. Strong economic fundamentals can generate strong demand.

The minister said migrant rural residents are becoming a larger group of home buyers throughout China. They could make up as much as 30 percent of the buyers in China’s smaller cities.