"Some people can buy several homes, some people can't even buy one," Mao Yushi, co-founder of the Unirule Institute of Economics, an independent think tank in Beijing, told MSN News. "There will be an impact on society."
As home values go up, more people are heading underground. Of the estimated 7.7 million migrants living in Beijing, approximately one-fifth live either at their workplace or underground, MSN News reports, citing the state news agency Xinhua.
However, Beijing's housing authority challenges that statistic, telling Reuters a government survey only found 280,000 migrants living in basements last year.
The government has increased the supply of low-cost public housing. In Beijing, the total floor space of public housing increased 20 percent in the first 11 months of 2013, compared to the same time period in 2012, MSN reports.
However, the problem may be getting worse as more people migrate to the country's major cities in hopes of employment and education opportunities.
The city of Beijing witnessed another 316,000 migrants in 2012, with the population reaching 19.6 million.
A vivid example of the "rat race" situation was a manhole in Beijing sealed by authorities after local media discovered a group of people living in the sewers underneath.
For now, the dream of owning a home may seem far-fetched for many Chinese.
"It's too difficult to have a house right now," Hu told MSN. "Every basement has people living in it...there are so many of us out there."