Since the Central Government announced to build southernmost Hainan island into an international tourist destination, the tropical island has experienced an influx of hot money as investors hope to be a part of the future economic surge.

One housing project in Haidiandao in Haikou, the provincial capital of Hainan, sold at 15,000 yuan ($2,200) per square meter in 2009. But after the news broke about Hainan's future as a tourist destination, the price rose to around 30,000 yuan ($4,400) per square meter.

Property dealers even refused to take mortgages, and only accepted full payment in cash. In extreme cases, some are selling apartments and houses before construction has commenced on their acquired land.

Wei Liucheng, Secretary of the CPC Committee of Hainan Province, said he was also caught off guard by the sudden surge in the real estate industry. Wei admitted Hainan lagged far behind the standards of an "international tourist destination" in many aspects.

Many feared another bubble burst in Hainan, as the island experienced a dramatic property downfall 14 years ago due to a sudden pullout of speculative money.

"The current housing price is way beyond local people's capability. Meanwhile, the high housing prices directly pushes up consumer prices, which add heavy pressure to the local people's living costs," said Xu Yan, a director of the Zhejiang Commerce in Hainan.