"Local governments owed Rmb 10,700bn at the end of 2010, and 53% of that must be paid back before the end of next year, according to the national audit office... land sales formed 74% of their revenue base in 2010, up from 10% in the late 1990s."
It is not just local governments, the economy itself is heavily reliant on real estate activity,
"Property construction accounts for 13% of GDP, so if property slumps so does the economy as a whole."
The capacity addition in residential property market has been truly staggering,
"The country’s 80,000 property developers own enough land to build nearly 100m apartments. Add this to vacant apartments for sale... and China already has the capacity to satisfy housing demand for up to 20 years."