Real estate prices are skyrocketing in China, and some are calling it a bubble.

Critics blame increasingly unaffordable prices on greedy developers and government policies, but Nicholas Lardy, an economist from the Peterson Institute for International Economics in Washington, D.C., says the number of Chinese people moving to big cities and doing well there is driving the boom.

Shanghai is where most of the action is. Prices there have risen more than 150 percent since 2003. A typical 1,100-square-foot apartment costs about $200,000. While by American standards that doesn't sound like much, the average resident earns less than $5,000 a year.

Luxury prices are much higher with some properties selling for more than $2,000 a square foot. By comparison, the average luxury apartment in Manhattan sold for less than $1,900 a square foot in the fourth quarter of 2009, according to Prudential Douglas Elliman real estate.

Source: The New York Times, David Barboza