Two visitors at the stand of Xiongan New Area at an exhibition held in Beijing in May. [Photo/China Daily]

Wu Hequan, deputy director of the Council of Experts for Coordinated Development of the Beijing-Tianjin-Hebei Region, issued the warning at a forum on urban construction in Beijing.

"There have been many places in China where house prices have risen too quickly," he said.

"At times, they have even been out of control. But Xiongan cannot afford to allow that to happen."

The central government announced plans to establish Xiongan New Area in April in order to integrate Beijing-Tianjin-Hebei development, and cut congestion and pollution in the capital.

The decision has since triggered a speculation frenzy in the property market, which has now prompted policy makers to call for tighter controls on real estate development in the area.

Xu Kuangdi, director of the Council of Experts think tank, stressed the environmental elements of the new area and its "green" potential

"The principle of the plan of the new economic zone is that it should be a livable, modern city with green spaces taking up more than half of the area," he said.

A blueprint for the area is still being studied and discussed by China's top institutions.

An overall plan will then be submitted to the central authorities for consideration.

Xu stressed that a new development model would be tested in Xiongan New Area. Balancing residents rights, controlling house prices and developing industry would be challenging, he said.

"The construction of underground infrastructure will be one of the bright spots," he said.

A disaster protection system, water supplies, electricity cables and gas pipes will be built under the surface along with a high-speed rail network and city traffic lanes.

"On the surface we will have green areas and sidewalks," said Xu.

Construction should focus on a more efficient transport network, environmental protection, urban and rural integration, and innovative urban planning.

"Industry in the economic zone should develop high-end manufacturing, featuring integrated production services," said Huang Qunhui, director of the Institute of Industrial Economics under the Chinese Academy of Social Sciences.

Located about 100 kilometers southwest of downtown Beijing, Xiongan New Area will cover the three existing counties of Xiongxian, Rongcheng and Anxin in Hebei province.