In China, the Starter Home is a Non Starter

The middle class is getting squeezed out of the country's ever-pricier housing market

Grace Du has everything going for her. The 26-year-old graduated with an economics degree from prestigious Jiao Tong University in Shanghai and landed a job as an administrative assistant at consultancy AT Kearney Inc. Her boyfriend is an engineer and, like Grace, is an only child living at home with his parents. They plan to get married, and their combined income of $1,250 per month puts them solidly in the ranks of China's middle class.

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