In May 2007, after waiting for the price to drop but not seeing any, people cashed their stocks to buy apartments in downtown area Shanghai. Price jumped 70% from April. You call it crazy. The wealth effect from stock market will reinforce spending, thus to push profits of public traded companies even higher.
Please quote your source. If it is true, the crash will be even harder. Once the stock market crashes, they have to sell their apartments. They will have no desire for spending. However the bubble can continue for longer than we expect.
check chinese news sites. it is all over the places. it is new apt price, not sec hands. http://news.soufun.com/2007-06-07/1084921.htm