UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q
(Mark One)

|X|  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934

For the quarterly period ended June 30, 2008

|_|  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ________________ to _______________

                                    000-51429
                            (Commission file number)

                     CHINA HOUSING & LAND DEVELOPMENT, INC.
                     --------------------------------------
        (Exact name of small business issuer as specified in its charter)

              Nevada                                             20-1334845
   (State or other jurisdiction                                (IRS Employer
of incorporation or organization)                           Identification No.)


                         6 Youyi Dong Lu, Han Yuan 4 Lou
                             Xi'An, Shaanxi Province
                                  China 710054
                    (Address of principal executive offices)

                                 86-029-82582632
                           (Issuer's telephone number)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes |_| No |X|

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of March 31, 2008 30,143,757
shares of common stock


Transitional Small Business Disclosure Format (check one): Yes |_| No |X|





<PAGE>





                     CHINA HOUSING & LAND DEVELOPMENT, INC.
                                      Index

                                                                           Page
                                                                          Number
--------------------------------------------------------------------------------
PART I.   FINANCIAL INFORMATION

Item 1.   Financial Statements

          Consolidated Balance Sheets as of June 30, 2008 (unaudited)
            and December 31, 2007                                            2

          Consolidated Statements of Income and Other Comprehensive
            Income for the three and six months ended June 30, 2008
            and 2007 (unaudited)                                             3

          Consolidated Statements of Cash Flows for six months ended
            June 30, 2008 and 2007 (unaudited)                               4

          Notes to Consolidated Financial Statements (unaudited)             6

Item 2.   Management's Discussion and Analysis or Plan of Operations         22

Item 3.   Quantitative and Qualitative Disclosures About Market Risk         32

Item 4T.  Controls and Procedures                                            33


PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings                                                  33

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds        33

Item 3.   Defaults Upon Senior Securities                                    33

Item 4.   Submission of Matters to a Vote of Security Holders                33

Item 5.   Other Information                                                  33

Item 6.   Exhibits                                                           33

SIGNATURES                                                                   34

EX-31.1 (Certifications required under Section 302 of the Sarbanes-Oxley Act of
2002)

EX-31.2 (Certifications required under Section 302 of the Sarbanes-Oxley Act of
2002)

EX-32.1 (Certifications required under Section 906 of the Sarbanes-Oxley Act of
2002)

EX-32.2 (Certifications required under Section 906 of the Sarbanes-Oxley Act of
2002)





<PAGE>
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION

                      China Housing & Land Development Inc.
                           Consolidated Balance Sheets
                    As of June 30, 2008 and December 31, 2007
                                   (unaudited)
                                                                    June 30,    December 31,
                                                                      2008         2007
                                                                 ------------   ------------
U.S.Dollars
                                     ASSETS
<S>                                                              <C>            <C>
Cash                                                             $ 22,765,615   $  2,351,015
Cash - restricted                                                   2,616,271        101,351
Accounts receivable, net of allowance for doubtful
  accounts of $100,515 and $95,515, respectively                   14,803,669     12,107,882
Other receivables, prepaid expenses, and other assets                 695,326        567,308
Notes receivable, net                                               3,902,925        947,918
Real estate
  Finished projects                                                14,800,499     16,130,130
  Construction in progress                                         43,264,042     24,856,801
                                                                 ------------   ------------
    Total real estate held for development or sale                 58,064,541     40,986,931

Advances to suppliers                                               1,848,771      2,071,549
Property and equipment, net                                         5,373,441      5,707,012
Deposits on land use rights                                        33,133,574     29,694,103
Assets held for sale                                               13,730,140     12,910,428
Deferred tax asset                                                    517,854             --
Deferred financing costs                                              703,356         55,451
Intangible assets, net                                             51,266,387     48,205,697
                                                                 ------------   ------------
    Total assets                                                 $209,421,870   $155,706,645
                                                                 ============   ============

                                  LIABILITIES
Accounts payable                                                 $ 15,713,607   $  9,311,995
Advances from customers                                             9,534,514      5,258,351
Accrued expenses                                                    2,850,233      1,903,451
Loans from New land's original shareholders                         8,560,152     11,413,229
Income and other taxes payable                                     25,241,322     22,711,981
Other payables                                                      4,865,949      3,881,137
Loans from employees                                                1,861,795      2,388,862
Loans payable                                                      29,595,720     14,120,034
                                                                 ------------   ------------
Deferred taxes liability                                           16,917,908     15,907,880
Warrants liability                                                  5,094,052      2,631,991
Fair value of embedded derivatives                                  3,472,887             --
Convertible debt                                                   13,078,213             --
                                                                 ------------   ------------
    Total liabilities                                             136,786,352     89,528,911
                                                                 ------------   ------------

SHAREHOLDERS' EQUITY
Common stock: $.001 par value, authorized 100,000,000 shares
issued and outstanding 30,143,757 and 30,141,887, respectively         30,144         30,142
Additional paid-in capital                                         28,391,500     28,381,534
Statutory reserves                                                  2,885,279      2,885,279
Retained earnings                                                  31,548,720     30,365,156
Accumulated other comprehensive income                              9,779,875      4,515,623
                                                                 ------------   ------------
    Total shareholders' equity                                     72,635,518     66,177,734
                                                                 ------------   ------------

    Total liabilities and shareholders' equity                   $209,421,870   $155,706,645
                                                                 ============   ============
</TABLE>

              The accompanying notes are an integral part of these
                        consolidated financial statements

                                       2
<PAGE>
<TABLE>
<CAPTION>

                      China Housing & Land Development Inc.
        Consolidated Statements of Income and Other Comprehensive Income
            For the three and six months ended June 30, 2008 and 2007
                                   (unaudited)

                                            Three months ended             Six months ended
                                                June 30,                       June 30,
                                      ----------------------------   ----------------------------
                                          2008             2007           2008           2007
                                      ------------    ------------   ------------    ------------
REVENUES
<S>                                   <C>             <C>            <C>             <C>
  Sale of properties                  $ 13,055,230    $ 11,135,812   $ 17,579,175    $ 19,181,388
  Other income                             189,260         882,778        411,952       1,033,399
                                      ------------    ------------   ------------    ------------
    Total revenues                      13,244,490      12,018,590     17,991,127      20,214,787
                                      ------------    ------------   ------------    ------------

COSTS AND EXPENSES
    Cost of properties and land         11,252,721       8,315,189     13,619,833      14,566,647
  Selling, general and
  administrative expenses                1,418,750         622,867      2,567,351       1,120,946
  Other expense                                 --           3,060         15,910          35,679
  Interest expense                         658,443         307,651      1,098,116         515,527
  Accretion expense on convertible
  debt                                     253,558              --        425,241              --
  Change in fair value of embedded
  derivatives                             (738,999)             --       (454,488)             --
  Change in fair value of warrants        (946,563)         11,204       (956,052)         11,204
  Foreign exchange loss                    103,344              --        103,344              --
                                      ------------    ------------   ------------    ------------
        Total costs and expenses        12,001,254       9,259,971     16,419,255      16,250,003
                                      ------------    ------------   ------------    ------------

Income before provision for income
taxes                                    1,243,236       2,758,619      1,571,872       3,964,784
Provision for income taxes                 107,357         927,739        388,308       1,341,402
                                      ------------    ------------   ------------    ------------

Net income                               1,135,879       1,830,880      1,183,564       2,623,382
Gain (loss) on foreign exchange          1,735,766         678,248      5,264,252         959,113
                                      ------------    ------------   ------------    ------------

Comprehensive income                  $  2,871,645    $  2,509,128   $  6,447,816    $  3,582,495
                                      ============    ============   ============    ============
Weighted average shares outstanding
    Basic                               30,143,757      26,312,014     30,143,161      23,453,110
                                      ============    ============   ============    ============
    Diluted                             30,311,201      26,386,036     30,304,679      23,527,132
                                      ============    ============   ============    ============

Earnings per share
    Basic                             $       0.04    $       0.07   $       0.04    $       0.11
                                      ============    ============   ============    ============
    Diluted                           $       0.03    $       0.07   $       0.02    $       0.11
                                      ============    ============   ============    ============
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements

                                       3
<PAGE>
<TABLE>
<CAPTION>
                      China Housing & Land Development Inc.
                      Consolidated Statements of Cash Flow
                 For the six months ended June 30, 2008 and 2007
                                   (unaudited)
                                                                                    Six months ended
                                                                                        June 30,
                                                                                  2008            2007
                                                                              ------------    ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                           <C>             <C>
Net income                                                                    $  1,183,564    $  2,623,382
Adjustments to reconcile net income to cash
provided by (used in) operating activities:
    Depreciation                                                                   183,657         176,107
    Exchange loss (gains)                                                          103,344         133,465
    Gain on disposal of fixed assets and inventory                                  14,844         702,314)
        Amortization of stock issued for investor relations fees                    67,367          66,370
    Change in fair value of warrants                                              (956,052)         11,204
        Change in fair value of embedded derivatives related to convertible
    debt                                                                          (454,488)             --
    Accretion expense convertible debt                                             425,241              --
    Non-cash proceeds from sales                                                (2,923,177)             --
(Increase) decrease in assets:
    Accounts receivable                                                         (1,871,161)        944,207
    Real estate                                                                (14,440,226)        525,434
    Advance to suppliers                                                           375,487        (222,916)
    Deposit on land use rights                                                  (1,594,144)             --
    Other receivables and deferred charges                                         233,934      (1,234,706)
Increase (decrease) in liabilities:
    Accounts payable                                                             5,654,551       1,617,561
    Advances from customers                                                      3,869,507      (1,306,372)
    Accrued expenses                                                               902,519      (1,536,651)
    Other payables                                                                 694,784       1,913,614
    Income and other taxes payable                                                 553,396       1,446,096
                                                                              ------------    ------------
Net cash provided by (used in) operating activities                           $ (7,977,053)   $  4,454,481
                                                                              ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Changes in restricted cash                                                      (2,437,759)       (102,776)
Purchase of buildings, equipment, and automobiles                                 (123,516)        256,904
Notes receivable collected                                                          71,614       1,095,005
Proceeds from sales of fixed assets                                                858,755              --
Cash from acquisition                                                                               50,701
                                                                              ------------    ------------
Net cash provided by (used in) investing activities                           $ (1,630,906)   $  1,299,834
                                                                              ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of convertible debt                                  19,230,370              --
Loans from banks                                                                14,168,119              --
Payments on loans                                                                              (11,426,243)
Payments to original shareholders                                                              (11,409,312)
Loans from employees                                                              (659,605)      1,446,255
Repayment of Loans from New Land previous shareholders                                          (3,476,856)
Proceeds from issuance of common stock and warrants                                  8,415      23,036,138
                                                                              ------------    ------------
Net cash provided by financing activities                                     $ 29,270,443    $  1,646,838
                                                                              ------------    ------------

INCREASE IN CASH                                                                19,662,484       7,401,153

EFFECTS ON FOREIGN CURRENCY EXCHANGE                                               752,116          55,138

CASH, beginning of period                                                        2,351,015         379,633
CASH, end of period                                                           $ 22,765,615    $  7,835,924
                                                                              ============    ============
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements

                                       4
<PAGE>
<TABLE>
<CAPTION>

                      China Housing & Land Development Inc.
                 Consolidated Statements of Shareholders' equity
                     For the six months ended June 30, 2008

                                   (Unaudited)




                                     Common Stock      Additional
                               ----------------------    paid in     Statutory
                                 Shares     Par Value    capital      reserves
                               ----------  ----------  -----------  -----------

<S>                            <C>         <C>         <C>          <C>
Balance, December 31, 2007     30,141,887  $   30,142  $28,381,534  $ 2,885,279

 Common Stock issued
  from warrants conversion          1,870           2        9,966
 Net Income
 Foreign currency translation
    adjustment
                               ----------  ---------- ------------  -----------
Balance, June 30, 2008         30,143,757  $   30,144 $ 28,391,500  $ 2,885,279
                               ==========  ========== ============  ===========



<CAPTION>

                                                         Accumulated
                                            Capital        other
                                Retained   contribution comprehensive
                                earnings    receivable     income            Totals
                               ----------- ------------  ------------     ------------

<S>                            <C>         <C>           <C>              <C>
Balance, December 31, 2007     $30,365,156 $       --    $  4,515,623     $ 66,177,734

 Common Stock issued
  from warrants conversion                                                       9,968
 Net Income                      1,183,564                                   1,183,564
 Foreign currency translation
    adjustment                                              5,264,252        5,264,252
                               ------------ -----------  ------------     ------------
Balance, June 30, 2008         $ 31,548,720 $       --   $  9,779,875     $ 72,635,519
                               ============ ===========  ============     ============

</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements

                                       5
<PAGE>



Note 1 -- Organization and Basis of Presentation

The interim consolidated financial statements are unaudited but, in the opinion
of management, reflect all adjustments necessary for a fair statement of the
Company's consolidated financial position, results of operations and cash flows
for the periods presented. These adjustments consist of normal, recurring items.
The results of operations for any interim period are not necessarily indicative
of results for the full year. The interim consolidated financial statements and
notes are presented as permitted by the requirements for Quarterly Reports on
Form 10-Q.

The consolidated financial statements do not include certain footnote
disclosures and financial information normally included in consolidated
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America ("GAAP") and, therefore, should be read
in conjunction with the consolidated financial statements and notes included in
the Company's Annual Report on Form 10-K for the year ended December 31, 2007
("2007 Annual Report").

Note 2 -- Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The accompanying consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries, Xi'an Tsining Housing Development
Company Inc. ("XTHDC"), Xi'an New Land Development Co. ("New Land") and Xi'an
Hao Tai Housing Development Company Inc. ("Hao Tai") (collectively, the
"Subsidiaries"). All inter-company accounts and transactions have been
eliminated on consolidation. The accompanying consolidated financial statements
have been prepared in conformity with GAAP.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

Reporting Currency and Foreign Currency Translation

As of June 30, 2008, the accounts of the Company's Subsidiaries are maintained
in their functional currency, the Chinese Yuan Renminbi ("RMB") and the accounts
of the Company are maintained in the United States Dollars ("USD"). The
reporting currency for the consolidated financial statements is the United
States Dollars (USD) which is in accordance with Statement of Financial Accounts
Standards ("SFAS") No. 52, "Foreign Currency Translation," with the RMB as the
functional currency. According to SFAS No. 52, all assets and liabilities of the
Subsidiaries are translated at the exchange rate on the balance sheet date,
shareholders' equity is translated at the historical rates and the statements of
operations and cash flows are translated at the weighted average exchange rate
for the year. The resulting translation adjustments are reported under other
comprehensive income in accordance with SFAS No. 130, "Reporting Comprehensive
Income." All monetary assets and liabilities of the Company dominated in foreign
currency are translated at the exchange rate on the balance sheet date and all
other items dominated in foreign currency are translated at the historical
rates. The resulting translation adjustments are reported under foreign exchange
gain or loss.

                                       6
<PAGE>
Revenue Recognition

Effective January 1, 2008, the Company changed its revenue recognition policy
for sales of development properties to the percentage of completion method.
Previously, the full accrual method was used. The percentage of completion
method will be based on estimated costs incurred. The change is preferable
because it has been made to more accurately reflect the business activity in the
Company and match revenues with the costs incurred in the pursuit of such
revenue. SFAS No. 154, "Accounting Changes and Error Corrections," requires that
a change in accounting principle be reflected through retrospective application
of the new accounting policy to all prior periods, unless it is impracticable to
do so. The Company has determined that retrospective application to periods
prior to January 1, 2008 is not practical as the necessary information needed to
restate prior periods is not available. Therefore, the Company began to apply
the percentage completion method beginning January 1, 2008.

Real estate sales are reported in accordance with the provisions of Statement of
Financial Accounting Standard No. 66, "Accounting for Sales of Real Estate".
Profit from the sales of development properties, less 5% business tax, is
recognized by the percentage of completion method on the sale of individual
units when all the following criteria are met:

a.    Construction is beyond a preliminary stage.
b.    The buyer is committed to the extent of being unable to require a refund
      except for non-delivery of the unit or interest.
c.    Sufficient units have already been sold to assure that the entire property
      will not revert to rental property.
d.    Sales prices are collectible.
e.    Aggregate sales proceeds and costs can be reasonably estimated.

If any of the above criteria is not met, proceeds shall be accounted for as
deposits until the criteria are met.

Under the percentage of completion method, revenues from condominium units sold
and related costs are recognized over the course of the construction period,
based on the completion progress of a project. In relation to any project,
revenue is determined by calculating the ratio of incurred costs, including land
use rights costs and construction costs, to total estimated costs and applying
that ratio to the contracted sales amounts. Cost of sales is recognized by
determining the ratio of contracted sales during the period to total estimated
sales value, and applying that ratio to the incurred costs. Current period
amounts are calculated based on the difference between the life-to-date project
totals and the previously recognized amounts.

Our significant judgments and estimates related to applying the percentage of
completion method include our estimates of the time necessary to complete the
project, the total expected revenue and the total expected costs. Fluctuations
in sales prices and variances in costs from budgets could change the percentages
of completion and affect the amount of revenue and costs recognized. Changes in
total estimated project costs or losses, if any, are recognized in the period in
which they are determined. Revenue recognized to date in excess of amounts
received from customers is classified as unbilled revenue. Amounts received from
customers in excess of revenue recognized to date are classified as current
liabilities under advances from customers.

For Company financed sales, the Company recognizes sales based on the full
accrual method provided that the buyer's initial and continuing investment is
adequate according to SFAS No. 66. The initial investment is the buyer's
down-payment less the loan amount provided by the Company. Interests on these
loans are amortized over the terms of the loans.

For land sales, the Company recognizes the revenue when title of the land
development right is transferred and collectability is assured.

For the reimbursement on infrastructure costs, the Company recognizes the
income, which is at the fair market value agreed between the Company and the
government of the People's Republic of China ("PRC"), when they enter into a
binding agreement with the government agreeing on the reimbursement.


                                       7
<PAGE>
Real Estate Capitalization and Cost Allocation

Real estate held for development or sale consists of residential and commercial
units under construction and units completed. Construction in progress includes
costs associated in development and construction of the Baqiao project, the
Junjing II project and land use right paid on Tang Du project.

The Company leases the land for the residential and commercial unit sites under
land use rights with various terms from the government of the PRC.

Real estate held for development or sale are stated at cost or estimated net
realizable value, whichever is lower. Costs include land and land improvements,
direct construction costs and development costs, including predevelopment costs,
engineering costs, interest on indebtedness, real estate taxes, wages,
insurance, construction overhead and indirect project costs. All costs are
accumulated by specific projects and allocated to residential and commercial
units within the respective projects. Selling and advertising costs are expensed
as incurred. Total estimated costs of multi-unit developments are allocated to
individual units based upon specific identification methods.

Land and land improvement costs include cost of land use rights, land
improvements, and real estate taxes. Appropriate costs are allocated to projects
on the basis of acreage, dwelling units and relative sales value.

Land and land improvements applicable to apartments and retail space are
transferred to construction in progress when construction commences.

If the real estate is determined to be impaired, it will be written down to its
fair market value. The Company evaluates the carrying value for impairment based
on the undiscounted future cash flows of the assets. Write-downs of inventory
deemed impaired would be recorded as adjustments to the cost basis. No
impairment loss was incurred or recorded for the three months and the six months
ended June 30, 2008 (June 30, 2007-- $Nil).

No depreciation is provided for construction in progress.

Capitalization of Interest

In accordance with SFAS 34, interest incurred during construction is capitalized
to construction in progress. All other interest is expensed as incurred.

For the three months ended June 30, 2008, interest incurred by the Company was
$930,717 (June 30, 2007 - $980,092) and capitalized interest for the same period
was $393,310 (June 30, 2007 - $672,441). For the six months ended June 30, 2008,
interest incurred was $1,733,748 (June 30, 2007 - $1,511,195) and capitalized
interest for the same period was $764,285 (June 30, 2007 --$995,668).

Concentration of Risks

The Company sells residential and commercial units to residents and small
business owners and the Company sells land to the local real estate developers.
There was no major customer that accounted for more than 5% of the sales for the
three months ended June 30, 2008 and one major customer accounted for 79% of the
sales for the three months ended June 30, 2007. The Company had one major
customer that accounted for approximately 23% of the Company's sales for the six
months ended June, 2008 (June 30, 2007 - 47%) and one customer accounted for 74%
of notes receivable as at June 30, 2008.


                                       8
<PAGE>
The Company is dependent on third-party sub-contractors, manufacturers, and
distributors for all of construction services and supply of construction
materials. Construction services or products purchased from the Company's five
largest subcontractors/suppliers accounted for 28% of total services and
supplies for the three months ended June 30, 2008 (June 30, 2007 - 55%) and 27%
for the six months ended June 30, 2008 (June 30, 2007 - 54%).

Accounts payables to these subcontractors/suppliers amounted to $1,481,274 at
June 30, 2008 (June 30, 2007 - $3,623,038).

The Company's operations are carried out in the PRC. Accordingly, the Company's
business, financial condition and results of operations may be influenced by the
political, economic and legal environments in the People's Republic of China and
by the general state of the People's Republic of China's economy. The Company's
business may be influenced by changes in governmental policies with respect to
laws and regulations, anti-inflationary measures, currency conversion and
remittance abroad, and rates and methods of taxation, among other things.

Cash and Concentration of Risk

Cash includes cash on hand and demand deposits in accounts maintained with
state-owned banks within the PRC. Total cash in state-owned banks at June 30,
2008 amounted to $21,887,431 (December 31, 2007 - $2,351,015) of which no
deposits are covered by insurance. The Company has not experienced any losses in
such accounts.

Restricted Cash

The bank grants mortgage loans to home purchasers and will transfer these
amounts to the Company's bank account once title passes. If the houses are not
completed and the new home owners have no ownership documents to secure the
loan, the bank will deduct 10% of the home owner's loan from the Company's bank
account and transfer that amount to a designated bank account classified on the
balance sheet as restricted cash. Interest earned on the restricted cash is
credited to the Company's normal bank account. The bank will release the
restricted cash after home purchasers have obtained the ownership documents to
secure the mortgage loan. Total restricted cash amounted to $2,616,271 as of
June 30, 2008 (December 31, 2007 - $101,351).

Accounts Receivable

Accounts receivable consists of balances due from customers for the sale of
residential and commercial units in the PRC. The Company provides an allowance
for doubtful accounts equal to the estimated uncollectible amounts. The
Company's estimated uncollectible amounts are based on historical collection
experience and a review of the current status of trade accounts receivable. It
is reasonably possible that the Company's estimate of the allowance for doubtful
accounts will change. Accounts receivable are presented net of an allowance for
doubtful accounts of $100,515 at June 30, 2008 (December 31, 2007 - $94,514).

Other Receivables

Other receivables consist of various cash advances to unrelated companies and
individuals with which management of the Company has business relationships.
These amounts are not related to operations of the Company, are unsecured,
non-interest bearing and generally short term in nature. The balance of other
receivables was $748,065(December 31, 2007 - $749,890) as of June 30, 2008.
Other receivables are reviewed annually as to whether their carrying value has
become impaired. As of June 30, 2008, the Company has established an allowance
for doubtful accounts of $202,459 (December 31, 2007 - $190,372).


                                       9
<PAGE>
Notes Receivable

The Company finances sales to certain new homeowners. Financing agreements are
signed and the loans are due in 1 to 3 years. The loans are non-interest
bearing, therefore the Company has discounted the carrying amount of notes
receivable at the market mortgage rate. Notes receivable are presented net of
allowance for doubtful accounts.

                                                    2008                 2007

Notes receivable                                $ 4,193,794         $ 1,036,775
Less: unamortized interest                         (290,869)            (88,857)

Notes receivable, net                           $ 3,902,925         $   947,918
                                                ===========         ===========

Property and Equipment

Property and equipment are recorded at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets. Depreciation
expense for the three months ended June 30, 2008 and 2007 amounted to $89,839
and $6,246, respectively. Depreciation expense for the six months ended June 30,
2008 and 2007 amounted to $183,657 and $176,107, respectively. Estimated useful
lives of the assets are as follows:

                                                       Estimated Useful Life

Head office buildings and improvements                        30 years
Vehicles                                                       6 years
Electronic equipment                                           5 years
Office furniture                                               5 years
Computer software                                              3 years


Maintenance, repairs and minor renewals are charged directly to expenses as
incurred. Major additions and betterment to property and equipment are
capitalized and depreciated over the remaining useful life of the assets.

Asset Held for Sale

The Company intends to sell one of its fixed assets which consist of 14,478
square meters of retail units with net book value of $13,730,140 as of June 30,
2008 (December 31, 2007 - $12,910,428).

Advances to Suppliers

Advances to suppliers consist of amounts paid in advance to contractors and
vendors for services and materials. Advances amounted to $1,848,771 as of June
30, 2008 (December 31, 2007 - $2,071,549).

Deposits on Land Use Rights

Deposits on land use rights consist of deposits held by the government to
purchase land use rights in Baqiao Park. Deposits amounted to $33,133,574 as of
June 30, 2008 (December 31, 2007 - $29,694,103).

Deferred financing cost

Debt issuance costs are capitalized as deferred financing cost and amortized on
a straight line basis over the term of the debt. The amortization expense for
three months ended June 30, 2008 was $38,909 (June 30, 2007 - $Nil). The
amortization expense for six months ended June 30, 2008 was $67,367 (June 30,
2007 - $Nil). This amortization expense was included in the general
administrative expense.


                                       10
<PAGE>
Intangible Asset

Intangible asset relates to the development right for the 487 acres of land in
Baqiao Park. The intangible asset is considered a definite lived intangible
asset. In accordance with SFAS No. 142, the intangible asset is subject to
amortization over its useful life. The method of amortization selected reflects
the pattern in which the economic benefit of the intangible asset is realized.
The amortization is based on the acreage of land sold or developed and
weighted-average expected profit margins. This method is intended to match the
pattern of amortization with the income-generating capacity of the asset.

As of June 30, 2008, the amount recorded for its intangible asset was
$51,266,387 (December 31, 2007 - $48,205,697). The Company evaluates its
intangible asset for impairment issues and whenever events or changes in
circumstances indicate that the carrying value of its intangible may not be
recoverable from its estimated future cash flows it records a write-down for
this impairment. For both the three months and the six months ended June 30,
2008 and 2007, the Company recorded no amortization on the intangible asset.

Long-lived Assets

The Company periodically evaluates the carrying value of long-lived assets to be
held and used in accordance with SFAS 144. SFAS 144 requires impairment losses
to be recorded on long-lived assets used in operations when indicators of
impairment are present and the undiscounted cash flows estimated to be generated
by those assets are less than the assets' carrying amounts. In that event, a
loss is recognized based on the amount by which the carrying amount exceeds the
fair market value of the long-lived assets. Loss on long-lived assets to be
disposed of is determined in a similar manner, except that fair market values
are reduced for the cost of disposal. Based on its review, the Company believes
there were no impairments of its long-lived assets as of June 30, 2008 and 2007.

Fair Value of Financial Instruments

Effective January 1, 2008, the Company adopted SFAS No. 157, "Fair Value
Measurements," (as impacted by FSP No. 157-1 and 157-2), which provides a
framework for measuring fair value under GAAP. As defined in SFAS No. 157, fair
value is the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date (exit price). The Company utilizes market data or assumptions
that the Company believes market participants would use in pricing the asset or
liability, including assumptions about risk and the risks inherent in the inputs
to the valuation technique. These inputs can be readily observable, market
corroborated or generally unobservable.

The Company primarily applies the market approach for recurring fair value
measurements and endeavors to utilize the best available information.
Accordingly, the Company utilizes valuation techniques that maximize the use of
observable inputs and minimize the use of unobservable inputs. The Company is
able to classify fair value balances based on the observability of those inputs.

SFAS No. 157 establishes a fair value hierarchy that prioritizes the inputs used
to measure fair value. The hierarchy gives the highest priority to unadjusted
quoted prices in active markets for identical assets or liabilities (Level 1
measurement) and the lowest priority to unobservable inputs (Level 3
measurement). The three levels of the fair value hierarchy defined by SFAS No.
157 are as follows:


                                       11
<PAGE>
Level 1   Quoted prices are available in active markets for identical assets or
          liabilities as of the reporting date. Active markets are those in
          which transactions for the asset or liability occur in sufficient
          frequency and volume to provide pricing information on an ongoing
          basis. Level 1 primarily consists of financial instruments such as
          exchange-traded derivatives, listed equities and U.S. government
          treasury securities.

Level 2   Pricing inputs are other than quoted prices in active markets included
          in Level 1, which are either directly or indirectly observable as of
          the reporting date. Level 2 includes those financial instruments that
          are valued using models or other valuation methodologies. These models
          are primarily industry-standard models that consider various
          assumptions, including quoted forward prices for commodities, time
          value, volatility factors, and current market and contractual prices
          for the underlying instruments, as well as other relevant economic
          measures. Substantially all of these assumptions are observable in the
          marketplace throughout the full term of the instrument, can be derived
          from observable data or are supported by observable levels at which
          transactions are executed in the marketplace. Instruments in this
          category include non-exchange-traded derivatives such as over the
          counter forwards, options and repurchase agreements.

Level 3   Pricing inputs include significant inputs that are generally less
          observable from objective sources. These inputs may be used with
          internally developed methodologies that result in management's best
          estimate of fair value from the perspective of a market participant.
          Level 3 instruments include those that may be more structured or
          otherwise tailored to customers' needs. At each balance sheet date,
          the Company performs an analysis of all instruments subject to SFAS
          No. 157 and includes in Level 3 all of those whose fair value is based
          on significant unobservable inputs.

Assets and liabilities measured at fair value on a recurring basis include the
following as of June 30, 2008:
<TABLE>
<CAPTION>

                                            Fair Value Measurements Using                Assets/Liabilities
                                        Level 1         Level 2         Level 3            At Fair Value
        Warrants liabilities               -          $5,094,052           -                 $5,094,052
       Derivative liabilities              -          $3,472,887           -                 $3,472,887
-------------------------------------- ----------- ------------------ ------------ -------------------------------
<S>                                                   <C>                                    <C>
                Total                      -          $8,566,939           -                 $8,566,939
</TABLE>

Accounts Payable

Accounts payable consists of balances due to subcontractors and suppliers for
the purchase of construction services and the Baqiao government for land use
right. Accounts payable amounted to $15,713,607 at June 30, 2008 (December 31,
2007 --$9,311,995).

Advances from Customers

Advances from customers represent prepayments by customers for home purchases.
The Company records such prepayment as advances from customers when the payments
are received. Advances from customers amounted to $9,534,514 at June 30, 2008
(December 31, 2007 --$5,258,351).

Other Payables

Other payables consist of various cash advances from unrelated companies and
individuals which management of the Company has business relationships. These
amounts are not related to operations of the Company, are unsecured,
non-interest bearing and short term in nature. Other payables amounted to
$4,865,949 as of June 30, 2008 (December 31, 2007 -- $3,881,137).


                                       12
<PAGE>
Advertising Costs

Advertising and sales promotion costs are expensed as incurred. Advertising
expense totaled $352,773 and $61,125 for the three months ended June 30, 2008
and 2007, respectively. Advertising expense totaled $634,671 and $124,016 for
the six months ended June 30, 2008 and 2007, respectively.

Warranty Costs

Generally, the Company provides all of its customers with a limited (half a year
to 5 years) warranty period for defective workmanship. The Company accrues the
estimated warranty costs into the cost of its homes as a liability after each
project is closed based on the Company's historical experience, which normally
is less than 0.2% of total costs of the project. Any excess amounts are expensed
in the period when they occur. Any significant material defects are generally
under warranty with the Company's suppliers. Currently, the Company retains 5%
of the total construction contract from the construction contractors for a
period of one year after the completion of the construction. Such retention
amounts will be used to pay for any repair expense incurred due to defects in
the construction. The Company has not historically incurred any significant
litigation requiring additional specific reserves for its product offerings. As
of June 30, 2008 and December 31, 2007, the Company accrued $0 as warranty
costs.

Income Taxes

The Company utilizes SFAS No. 109, "Accounting for Income Taxes," which requires
the recognition of deferred tax assets and liabilities for the expected future
tax consequences of events that have been included in the financial statements
or tax returns. Under this method, deferred income taxes are recognized for the
tax consequences in future years of differences between the tax bases of assets
and liabilities and their financial reporting amounts at each period end based
on enacted tax laws and statutory tax rates applicable to the periods in which
the differences are expected to affect taxable income. Valuation allowances are
established, when necessary, to reduce deferred tax assets to the amount
expected to be realized. At June 30, 2008 the significant book to tax difference
was related to the intangible asset which has no tax value and the cost of sales
adjustment related to the Tsining JunJing II project. There was no significant
book to tax differences for 2007.

The Company adopted the provisions of FASB Interpretation No. 48, "Accounting
for Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109",
("FIN 48"), on January 1, 2007. The Company did not have any material
unrecognized tax benefits and there was no effect on its financial condition or
results of operations as a result of implementing FIN 48.

The Company files income tax returns in the PRC jurisdictions. The Company does
not believe there will be any material changes in its unrecognized tax positions
over the next 12 months.

The Company's policy is to recognize interest and penalties accrued on any
unrecognized tax benefits as a component of general and administrative expense.
As of the date of adoption of FIN 48, the Company did not have any accrued
interest or penalties associated with any unrecognized tax rate differences from
the federal statutory rate primarily due to non-deductible expenses, temporary
differences and preferential tax treatment. No assessments on the income taxes
for the 2006, 2007 and 2008 have been received by the Company.


                                       13
<PAGE>
Local PRC Income Tax

The subsidiaries of the Company are governed by the Income Tax Laws of the PRC
concerning Chinese registered limited liability companies. Under the Income Tax
Laws of the PRC, Chinese enterprises are generally subject to an income tax at a
statutory rate of 25% on income reported in the statutory financial statements
after appropriate tax adjustments, unless the enterprise is located in a
specially designated region for which more favorable effective tax rates are
applicable. New Land and Hao Tai are entitled to a refund of 6% of taxes
otherwise payable.


The provision for income taxes for the three months and the six months ended
June 30, 2008 and 2007 consisted of the following:
<TABLE>
<CAPTION>
                                                 Three months                Six months
                                              2008           2007        2008          2007
                                           ----------    ----------   ----------    ----------
<S>                                        <C>           <C>          <C>           <C>
Provision for China income and local tax   $  617,911    $  927,739   $  898,862    $1,341,042
Recovery of deferred taxes                 $ (501,554)           --   $ (501,554)           --
                                           ----------    ----------   ----------    ----------
Total provision for income taxes           $  107,357    $  927,739   $  388,308    $1,341,042
                                           ==========    ==========   ==========    ==========
</TABLE>

The following table reconciles the U.S. statutory rates to the Company's
effective tax rate at June 30, 2008 and 2007:

                                                      Six months
                                                   2008       2007
U.S. statutory rates                                34%        34%
Non taxable income                                 -19%         -
Foreign income not recognized in USA               -15%       -34%
Statutory income taxes in China                     25%        33%
                                                    25%        33%
Represented by:
PRC income taxes payable                            57%        33%
Deferred taxes provision                           -32%          -
Provision for income taxes                          25%        33%

Basic and Diluted Earnings Per Share

Earning per share is calculated in accordance with the SFAS No. 128, "Earnings
per share". Basic net earnings per share is based upon the weighted average
number of common shares outstanding. Diluted net earnings per share is based on
the assumption that all dilutive convertible shares and stock options and
warrants were converted or exercised. Dilution is computed by applying the
treasury stock method.

Under this method, options and warrants are assumed to be exercised at the
beginning of the period (or at the time of issuance, if later), and as if funds
obtained thereby were used to purchase common stock at the average market price
during the period.

Comprehensive Income

Comprehensive income consists of net income and foreign currency translation
gains and losses affecting shareholders' equity that, under GAAP, are excluded
from net income. Gain on foreign exchange translation totaled $1,735,766 and
$678,248 for the three months ended June 30, 2008 and June 30, 2007
respectively. Gain on foreign exchange translation totaled $5,264,252 and
$959,113 for the six months ended June 30, 2008 and 2007, respectively.

Statement of Cash Flows

In accordance with SFAS No. 95, "Statement of Cash Flows," cash flows from the
Company's operations is calculated based upon the local currencies. As a result,
amounts related to assets and liabilities reported on the statement of cash
flows will not necessarily agree with changes in the corresponding balances on
the balance sheet.

                                       14
<PAGE>

Accounting Principles Recently Adopted.

SFAS No. 159, "The Fair Value Option for Financial Assets and Financials
Liabilities -- Including an Amendment of FASB Statement No.115" issued by FASB
in February 2007, this standard permits measurement of certain financial assets
and financial liabilities at fair value. If the fair value option is elected,
the unrealized gains and losses are reported in earnings at each reporting date.
Generally, the fair value option may be elected on an instrument-by-instrument
basis, as long as it is applied to the instrument in its entirety. The fair
value option election is irrevocable, unless a new election date occurs. SFAS
No. 159 requires prospective application and certain additional presentation and
disclosure requirements. The adoption on January 1, 2008 of this statement did
not have a material impact on the Company's consolidated financial statements.

Recent Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 141(R), "Business Combinations"
("SFAS No. 141(R)") which revised SFAS No. 141, "Business Combinations". SFAS
No. 141(R) establishes principles and requirements for how an acquirer
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, any non-controlling interest in the acquirer
and the goodwill acquired. SFAS No. 141(R) also establishes disclosure
requirements which will enable users to evaluate the nature and financial
effects of the business combination. This standard is effective for fiscal years
beginning after December 15, 2008. As the provisions of SFAS No. 141(R) are
applied prospectively, the impact of this standard cannot be determined until
the transactions occur.

In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in
Consolidated Financial Statements". SFAS No. 160 establishes accounting and
reporting standards for ownership interests in subsidiaries held by parties
other than the parent, the amount of consolidated net income attributable to the
parent and to the noncontrolling interest, changes in a parent's ownership
interest and the valuation of retained noncontrolling equity investments when a
subsidiary is deconsolidated. SFAS No. 160 also establishes reporting
requirements that provide sufficient disclosures that clearly identify and
distinguish between the interests of the parent and the interests of the
noncontrolling owners. This standard is effective for fiscal years beginning
after December 15, 2008. The impact of this standard cannot be determined until
the transactions occur.

In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative
Instruments and Hedging Activities" ("SFAS No. 161"). SFAS No. 161 amends and
expands the disclosure requirements of FASB Statement 133, "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS No. 133") to require
qualitative disclosures about objectives and strategies for using derivatives,
quantitative disclosures about fair value amounts of and gains and losses on
derivative instruments, and disclosures about credit risk-related contingent
features in derivative agreements. The Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008. Early application is encouraged. The Company is currently evaluating
the impact of the adoption of SFAS No. 161.

In April 2008, the FASB issued FSP SFAS 142-3, "Determination of the Useful Life
of Intangible Assets" ("FSP 142-3"). This guidance is intended to improve the
consistency between the useful life of a recognized intangible asset under SFAS
No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"), and the period of
expected cash flows used to measure the fair value of the asset under SFAS 141R
when the underlying arrangement includes renewal or extension of terms that
would require substantial costs or result in a material modification to the
asset upon renewal or extension. Companies estimating the useful life of a
recognized intangible asset must now consider their historical experience in
renewing or extending similar arrangements or, in the absence of historical
experience, must consider assumptions that market participants would use about
renewal or extension as adjusted for SFAS 142's entity-specific factors. FSP
142-3 is effective for us beginning January 1, 2009. The Company is currently
evaluating the potential impact of the adoption of FSP 142-3.


                                       15
<PAGE>
In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted
Accounting Principles." SFAS No. 162 identifies the sources of accounting
principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with GAAP. SFAS No. 162 is effective 60 days following
the Securities and Exchange Commission's approval of the Public Company
Accounting Oversight Board amendments to AU Section 411, "The Meaning of Present
Fairly in Conformity with Generally Accepted Accounting Principles." The Company
is currently evaluating the potential impact of the adoption of SFAS No. 162.

In May 2008, the FASB issued FASB FSP APB 14-1, "Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement)". FSP APB 14-1 requires the issuer of certain convertible debt
instruments that may be settled in cash (or other assets) on conversion to
separately account for the liability (debt) and equity (conversion option)
components of the instrument in a manner that reflects the issuer's
non-convertible debt borrowing rate. Such separate accounting also requires
accretion of the resulting discount on the liability component of the debt to
result in interest expense equal to an issuer`s nonconvertible debt borrowing
rate. In addition, the FSP provides for certain changes related to the
measurement and accounting related to derecognition, modification or exchange.
FSP APB 14-1 is effective for fiscal years beginning after December 15, 2008 on
a retroactive basis. The Company is currently evaluating the potential impact of
the adoption of FSP APB 14-1.

In June 2008, the FASB issued FSP EITF 03-6-1, "Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities." FSP
EITF 03-6-1 addresses whether instruments granted in share-based payment
transactions are participating securities prior to vesting and, therefore, need
to be included in the earnings allocation in computing income per share under
the two-class method pursuant to SFAS No. 128, "Earnings per Share." This
guidance establishes that unvested share-based payment awards that contain
nonforfeitable rights to dividends or dividend equivalents (whether paid or
unpaid) are participating securities and shall be included in the computation of
earnings per share pursuant to the two-class method. FSP EITF 03-6-1 is
effective for financial statements issued for fiscal years beginning after
December 15, 2008. Furthermore, all prior period earnings per share data
presented shall be adjusted retrospectively to conform to the provisions of FSP
EITF 03-6-1. The Company is currently evaluating the potential impact of the
adoption of FSP EITF 03-6-1.

Note 3 -- Supplemental Disclosure of Cash Flow Information

Income taxes paid amounted to $225,964 for the six months ended June 30, 2008
(June 30, 2007 - $Nil). Interest paid for the six months ended June, 2008 and
2007 amounted to $825,479 and $632,857, respectively.

                                       16
<PAGE>
Note 4 -- Accounts Receivable

Accounts receivable consist of the following at June 30, 2008 and December 31,
2007:

                                                   June 30,         December 31,
                                                     2008               2007
                                                ------------       ------------
Accounts receivable                             $ 14,904,814       $ 12,202,396
Allowance for doubtful accounts                     (100,515)           (94,514)
                                                ------------       ------------

Accounts receivable, net                        $ 14,803,669       $ 12,107,882
                                                ============       ============

Note 5 - Other Receivables, Prepaid Expenses and Other Assets

Other receivables, prepaid expenses and other assets consist of the following at
June 30, 2008 and December 31, 2007:

                                                 June 30,       December 31,
                                                   2008             2007
                                                ---------        ---------
Other receivables                               $ 748,065        $ 749,890
Allowance for bad debts                          (202,459)        (190,372)
Prepaid expenses                                   22,425            7,790
Other asset                                       127,295
                                                ---------        ---------

Other receivables, prepaid expense
other assets                                    $ 695,326        $ 567,308
                                                =========        =========

Note 6 -- Property and Equipment, Net

Property and equipment consist of the following at June 30, 2008 and December
31, 2007:

                                                    June 30,       December 31,
                                                      2008            2007
                                                  ------------     ------------
Head office buildings and improvements            $  1,083,160     $  1,018,494
Income producing properties                         18,951,037       18,469,840
Electronic equipment                                   214,257          195,244
Vehicles                                                70,760           87,740
Office furniture                                       127,583          119,960
Computer software                                       84,593           48,180
                                                  ------------     ------------
Totals                                              20,531,750       19,939,470

Accumulated depreciation                            (1,428,169)      (1,322,030)
Net book value of building held for sale           (13,730,140)     (12,910,428)

Property and equipment, net                       $  5,373,440     $  5,707,012
                                                  ============     ============

Note 7 - Intangible asset

Intangible asset consists of the following at June 30, 2008 and December 31,
2007:

                                                 June 30,           December 31,
                                                   2008                 2007
                                               ------------         ------------
Intangible acquired                            $ 52,550,182         $ 49,412,847
Accumulated depreciation                         (1,283,795)           1,207,150
                                               ------------         ------------

Intangible asset, net                          $ 51,266,387         $ 48,205,697
                                               ============         ============

                                       17

<PAGE>
Note 8 - Loans Payable to New Land's Previous Shareholders

The Company has loans payable to previous shareholders of New Land that totaled
to $8,560,152 at June 30, 2008 (December 31, 2007 -- $11,413,229). The remaining
balance pertains to additional loans made by these shareholders and is due in
June 2008. The loans bear interest at 10% per annum.

Note 9 -- Loans from Employees

The Company has borrowed monies from certain employees to fund the Company's
construction projects. The loans bear interest ranging between 7% and 12% and
the principal matures in 2009. At June 30, 2008, loans from employees amounted
to 1,861,795(December 31, 2007 -- $2,388,862).

Note 10 -- Loans Payable

Loans payable represent amounts due to various banks and are due on demand or
within one year. These loans generally can be renewed with the banks when they
expire. Loans payable at June 30, 2008 and December 31, 2007 consisted of the
following:
<TABLE>
<CAPTION>

                                                                    June 30,   December 31,
                                                                      2008         2007
                                                                  ----------   ------------
<S>                                                               <C>           <C>
Commercial Bank Weilai Branch
    originally due August 29, 2008 and renewed to August 29,
    2008, annual interest rate is at percent, 11.34 percent
    secured by the Company's Xin Xing Gangwan, Xin Xing Xing
    Gang Wan Xin Xing Tower and Ming Yuan Yuan projects           $5,540,085    $5,209,333

Commercial Bank Weilai Branch
    originally due December 31, 2008 and renewed to
    December 31, 2008, annual interest is at 9.79
    percent, secured by the Company's 24G projects                 5,831,669     5,483,508

Xi'an Rural Credit union Zao Yuan Rd. Branch,
    Due June 14, 2009, annual interest is at 9.527 percent,
    secured by the Company's Jun Jing Yuan I, Yuan I, Han Yuan
    and Xin Xing Tower projects                                    3,644,793     3,427,193

China  Construction Bank, Xi'an Branch, Due July 14, 2008,
    annual interest is at 9% Percent, secured by the
    Company's Jun Jing Yuan II                                    14,579,173             -

                          Total                                  $29,595,720   $14,120,034
</TABLE>

All loans were borrowed for construction projects. All interest paid was
capitalized and allocated to various construction projects. The loan due to
China Construction Bank of $14,579,173 was paid in full on July 14, 2008.

On June 28, 2008, the Company signed a strategic partnership agreement with the
China Construction Bank Shaanxi Branch that establishes a RMB 1 billion credit
line for construction loans to support the construction work of the Company and
its subsidiaries. The Company had not utilized the credit line as of June 30,
2008.

                                       18
<PAGE>
Note 11 - Convertible debt

On January 28, 2008, the Company issued Senior Secured Convertible Notes due in
2013 (the "Convertible debt") and warrants to subscribe for common shares for an
aggregate purchase price of US$20 million. The Convertible debt bears 5% per
annum (computed based on the actual days elapsed in a period of 360 days) of the
RMB notional principle amount, payable quarterly in arrears in U.S. Dollars on
the first business day of each calendar quarter and on the maturity date. In
addition, 1,437,467 five-year warrants were granted with a strike price of $6.07
per common share, which are callable if certain stock price thresholds are met.
Approximately 215,620 warrants are also available as a management incentive if
certain milestones are met.


The holders have the right to convert up to 45% ($9 million) of the principal
amount of the Convertible debt into common shares at an initial conversion price
of $5.57, subject to upward adjustment. The Company, at its discretion, may
redeem the remaining $11 million of Convertible debt at 100% of the principle
amount, plus any accrued and unpaid interest. The warrants associated with the
Convertible debt grant the holders the right to acquire shares of common stock
at $6.07 per share, subject to customary anti-dilution adjustments. The warrants
may be exercised to purchase common stock at any time up to and including
February 28, 2013.

The convertible debt is secured by a first priority, perfected security interest
in certain shares of common stock of Lu Pingji, the president of the Company.
The convertible debt is subject to events of default customary for convertible
securities and for a secured financing.

Both warrant and embedded derivative associated with convertible debt meet the
definition of a derivative instrument according to FASB No. 133 and should be
recorded as a derivative instrument liabilities and periodically
marked-to-market. The fair value of warrants and embedded derivative on
inception were determined to be $3,419,653 and $3,927,375, respectively, using
the Cox-Rubinstein-Ross Binomial Lattice Model with the following assumption:
expected life 5 years, expected volatility - 75%, risk free interest rate -
2.46% and dividend rate - 0%. The fair value of the warrants and embedded
derivative at June 30, 2008 were determined to be of $3,010,665 and $3,472,887,
respectively, using the Cox-Rubinstein-Ross Binomial Lattice Model with the
following assumption: expected life 4.58 years, expected volatility - 75%, risk
free interest rate - 3.22% and dividend rate - 0%. For the three months ended
June 30, 2008, the Company recorded a change in fair value for warrants and
embedded derivative of $652,744 and $738,999, respectively in the consolidated
statement of income. For the six months ended June 30, 2008, the Company
recorded a change in fair value for warrants and embedded derivative of $408,988
and $454,488, respectively.

After allocating the gross proceeds to the fair value of the warrants and the
embedded derivative instrument, the remaining proceeds were allocated as the
initial carrying value of the Convertible debt. It is accreted to its face
amount at maturity using the effective interest method. The effective interest
rate was determined to be 15.42%. The carrying value of Convertible debt at June
30, 2008 was $13,078,213. Related interest expense and accretion expense for the
three months ended June 30, 2008 were $257,827 and 253,558, respectively.
Related interest expense and accretion expense for the six months ended June 30,
2008 were $435,603 and $425,241, respectively.

Note 12 -- Shareholders' Equity

Common stock

On January 15, 2007, the Company issued 60,000 shares of common stock to an
investor relations company in consideration for one year of consulting service
through December 31, 2007. The 60,000 shares of common stock have been recorded
at $2.19 per share or $131,400 based on the trading price of the shares at
January 12, 2007. This amount was included in prepaid expenses and is being
amortized over the service period.


                                       19
<PAGE>
Pursuant to securities purchase agreements with accredited investors dated May
7, 2007, the Company received $25,006,978 and issued 9,261,847 shares of common
stock and 2,778,554 warrants. Each warrant is exercisable for five years at
$4.50 per share. In connection with the offering, the Company paid a 7%
placement fee and $173,689 in legal fees. The fair value of the warrants at
December 31, 2007 was determined to be $0.76 per warrant using the CRR Binomial
Lattice Model with the following assumptions: expected life - 4.34 years;
expected volatility - 75%, risk fee interest rate - 3.35% and dividend rate -
0%.

According to Section 4.8, Anti-Dilute of the Share Purchase Agreements dated
June 28, 2006, July 7, 2006 and August 21, 2006, the Company issued 126,138
shares of common stock and 27,364 warrants; additionally, the Company reduced
the exercise price of all related warrants from $3.60 to $3.31. The fair value
of the warrants at December 31, 2007 was determined to be $2.55 per warrant
using the CRR Binomial Lattice Model with the following assumptions: expected
life - 1.53 years; expected volatility - 75%, risk fee interest rate - 3.20% and
dividend rate - 0%.

Pursuant to EITF 00-19, "Accounting for Derivative Financial Instruments Indexed
to, and Potentially Settle in, a Company's Own Stock," the warrants issued
contain a provision permitting the holder to demand payment based on a Black
Scholes valuation in certain circumstances. Therefore, under EITF 00-19 and SFAS
No. 133, the Company recorded the warrants as a liability at their fair value on
the date of grant and then marked them to $5,094,052 at June 30, 2008 using the
CRR Binomial Lattice Model with the following assumptions: expected life -1
year; expected volatility - 75%, risk fee interest rate - 2.36% and dividend
rate - 0%. The change in fair value of warrants totaled for the three months
ended June 30, 2008 was $293,819 (June 30, 2007 - $11,204) and that for the six
months ended June 30, 2008 was $547,064 (June 30, 2007 - $11,204).

1,870 warrants having an exercise price of $4.50 were exercised in Feb 2008 on a
cash basis, resulting in the issuance of 1,870 shares of common stock with
proceeds of $8,415.

Warrants

Following is a summary of the warrant activity:


                          Warrants            Warrants        Weighted Average
                        Outstanding          Exercisable       Exercise Price

December 31, 2007         2,946,383            2,946,383           $4.41

Granted                   1,437,467            1,437,467           $6.07
Exercised                   (1,870)              (1,870)           $4.50

------------------------------------ -------------------- --------------------
June 30, 2008             4,381,980            4,381,980           $4.95
------------------------------------ -------------------- --------------------

Following is a summary of the status of warrants outstanding at June 30, 2008:

   Outstanding Warrants                           Exercisable Warrants
    Exercise     Number     Average Remaining    Average       Exercise
     Price                  Contractual Life      Price         Number

     $3.31       213,131       1.03 years         $3.31        213,131
     $4.50     2,731,382       3.84 years         $4.50      2,731,382
     $6.07     1,437,467       4.58 years         $6.07      1,437,467

                                       20
<PAGE>
Statutory Reserves

In accordance with the laws and regulations of the PRC, a wholly-owned Foreign
Invested Enterprises' income, after the payment of the PRC income taxes, shall
be allocated to the statutory surplus reserves. The proportion of allocation for
reserve funds is no less than 10 percent of the profit after tax until the
accumulated amount of allocation for statutory surplus reserve funds reaches 50
percent of the registered capital. Statutory reserves represent restricted
retained earnings.

Statutory surplus reserves are to be utilized to offset prior years' losses, or
to increase its share capital. When a limited liability company converts its
surplus reserves to capital in accordance with a shareholders' resolution, the
Company will either distribute new shares in proportion to the number of shares
held by each shareholder, or increase the par value of each share. Except for
the reduction of losses incurred, any other usage should not result in this
reserve balance falling below 25% of the registered capital. Registered capital
at June 30, 2008 is approximately $34.5 million (December 31, 2007 - $23.6
million)

Pursuant to the board of directors' resolution, XTHDC transferred 10% of its net
income, as determined in accordance with the PRC accounting rules and
regulations, to a statutory surplus reserve fund until such reserve balance
reaches 50% of the Company's registered capital.

The transfer to this reserve must be made before distributions of any dividends
to shareholders. For the three months ended June 30, 2008, the Company
appropriated $0 (June 30, 2007 - $238,334) to this surplus reserve.
For the six months ended June 30, 2008, the Company appropriated $0 (June 30,
2007 - $322,320) to this surplus reserve.

Note 13 -- Employee Welfare Plan

Regulations in the PRC require the Company to contribute to a defined
contribution retirement plan for all permanent employees. The Company
established a retirement pension insurance, unemployment insurance, health
insurance and house accumulation fund for the employees during the term they are
employed. For the three months ended June 30, 2008 and 2007, the Company made
contributions in the amount of $25,528 and $5,384, respectively. For the six
months ended June 30, 2008 and 2007, the Company made contributions in the
amount of $32,109 and $11,602, respectively.

Note 14 -- Earnings Per Share

Earnings per share for the three months and the six months ended June 30, 2008
and 2007 were determined by dividing net income for the years by the weighted
average number of both basic and diluted shares of common stock and common stock
equivalents outstanding. The net income for diluted Earnings per share was
adjusted.
<TABLE>
<CAPTION>

                                                       Three Months                    Six Months
                                                   2008            2007            2008          2007
                                              ------------    ------------   ------------    ------------
<S>                                           <C>             <C>            <C>             <C>
Net income for basic earnings per share       $  1,135,879    $  1,830,880   $  1,183,564    $  2,623,382
Change in fair value on dilutive warrants:        (288,510)             --       (547,064)             --

Net (loss) income for diluted earnings per         847,369       1,830,880        636,500       2,623,382
share

Weighted average shares outstanding - basic     30,143,757      26,312,014     30,143,161      23,453,110
Effect of diluted securities and warrants:         167,444          74,022        161,519          74,022

Weighted average shares outstanding -           30,311,201      26,386,036     30,304,679      23,527,132
diluted

Earnings per share
   - Basic                                    $       0.04    $       0.07   $       0.04    $       0.11
   - diluted                                          0.03            0.07           0.02            0.11
</TABLE>


                                       21
<PAGE>
The convertible debt and warrants issued along with the debt have an
anti-dilutive effect on the earnings per share and are therefore excluded from
the determination of diluted earnings per share calculation.

Note 15 -- Commitments and Contingencies

The Company leases part of its office space under long-term, non-cancelable
operating lease agreements. The leases expire on December 31, 2008. The future
minimum rental payments required under the operating lease agreements are
$49,608.

As of June 30, 2008, the Company was in a contract to acquire one land use right
with an unpaid balance of approximately $2.6 million. The balance is not due
until the vendor removes the existing building on the land and changes the
zoning status on the land use right certificate.

Note 16 -- Subsequent Events

On July 2, 2008, the directors of the board of the Company approved that 750,000
shares of the common stock be granted to the members of the management based on
the Company's financial performance of fiscal year 2007. The number of shares
granted to each individual is calculated in accordance with the Company's
Detailed Implementation Rule for Restrictive Stock Incentive Plan of 2007-2008.
A stock-based compensation expense of approximately $3 million will be recorded
by the Company in July 2008.

ITEM 2. Management's Discussion and Analysis

FORWARD LOOKING STATEMENTS

Some of the statements contained in this Form 10-Q that are not historical facts
are "forward-looking statements" which can be identified by the use of
terminology such as "estimates," "projects," "plans," "believes," "expects,"
"anticipates," "intends," or the negative or other variations, or by discussions
of strategy that involve risks and uncertainties. We urge you to be cautious of
the forward-looking statements, that such statements, which are contained in
this Form 10-Q, reflect our current beliefs with respect to future events and
involve known and unknown risks, uncertainties and other factors affecting our
operations, market growth, services, products and licenses. No assurances can be
given regarding the achievement of future results, as actual results may differ
materially as a result of the risks we face, and actual events may differ from
the assumptions underlying the statements that have been made regarding
anticipated events. Factors that may cause actual results, our performance or
achievements, or industry results, to differ materially from those contemplated
by such forward-looking statements include without limitation:

o    Our ability to attract and retain management, and to integrate and maintain
     technical information and management information systems;

o    Our ability to raise capital when needed and on acceptable terms and
     conditions;

o    The intensity of competition; and

o    General economic conditions.


                                       22
<PAGE>
All written and oral forward-looking statements made in connection with this
Form 10-Q that are attributable to us or persons acting on our behalf are
expressly qualified in their entirety by these cautionary statements. Given the
uncertainties that surround such statements, you are cautioned not to place
undue reliance on such forward-looking statements.

CONSOLIDATED OPERATING RESULTS

Three Months Ended June 30, 2008 Compared With Three Months Ended June 30, 2007

Revenues

Total revenues for the three months ended June 30, 2008 increased 10.2 percent
to $13,244,490 from $12,018,590 for the three months ended June 30, 2007. The
increase was due primarily to the revenues from the Tsining JunJing II project
that was reported using the percentage of completion method of accounting and
included all pre-sales that had been completed since September 2007.

Revenues by our major projects

Effective January 1, 2008, the company adopted the percentage of completion
method of accounting for revenue recognition for all construction projects in
progress, which currently includes Project Tsining JunJing II.

Project Tsining JunJing II revenues for the second quarter 2008 were $12,041,821
compared with no revenue for the second quarter 2007. Progress during the
quarter permitted all cash received from the pre-sales of housing units to be
recognized as revenues during the second quarter of 2008. The pre-sales of units
began in September 2007 and the first revenue recognition for this project
occurred in the second quarter 2008.

Project Tsining-24G revenues for the second quarter 2008 were $173,919 compared
with $9,720,990 for the second quarter 2007. Sales for most of 24G project were
completed in the second quarter 2007. The revenues in the second quarter 2008
resulted from the sales of a few of the remaining available retail spaces.

Project Tsining JunJing I revenues for the second quarter 2008 decreased 64.4
percent to $414,220 from $1,163,950 for the second quarter 2007 because most of
the available units in this project were sold in March 2008, so only a few
remaining units were sold during the second quarter 2008.

The Baqiao infrastructure construction project generated revenues of $358,716
for the second quarter 2008 compared with no revenue for the second quarter
2007. The company acquired the infrastructure construction project in March
2007, and the first revenues occurred in the fourth quarter of 2007. The
revenues in the second quarter of 2008 consisted of the government's allowance
for interest income on the company's investments required to support the
infrastructure construction project, support continued river management, and
support suburban planning for the entire Baqiao high-technology industrial park.

                                       23
<PAGE>

Revenues by project:                  3 months ended         3 months ended
(US$ in millions)                      June 30, 2008          June 30, 2007

Projects
Tsining JunJing II                              12.1                      -
Tsining 24G                                      0.2                    9.7
Tsining JunJing I                                0.4                    1.2
Additional projects                              0.0                    0.2
Baqiao infrastructure construction               0.4
Total Sales of properties                       13.1                   11.1

Other income

Other income for the second quarter 2008 decreased 78.6 percent to $189,260 from
$882,778 for the second quarter 2007 primarily due to the absence of a property
clean-up project performed in second quarter of 2007. The revenues in the second
quarter 2008 consisted primarily of sales of excess assets.

Cost of revenues

The cost of revenues for the second quarter 2008 increased 35.3 percent to
$11,252,721 from $8,315,189 for the second quarter 2007. The higher cost of
revenues for the second quarter 2008 was primarily due to the costs of revenues
recognized using the percentage of completion method of accounting for the
Tsining JunJing II project in the second quarter 2008. The second quarter 2007
included the cost of revenues using the full accrual method of accounting.

Gross profit and gross profit margin

Gross profit for the second quarter 2008 was $1,991,769, down 46.2 percent from
$3,703,401 for the second quarter 2007. The gross profit margin for the second
quarter 2008 was 15.40 percent compared to 30.81 percent for the second quarter
2007. The declines were due primarily to the incentive discounts given to the
first buyers in the new Tsining JunJing II to promote market interest and
encourage future sales for the project.

Selling, general, and administrative expenses

Selling, general, and administrative expenses for the second quarter 2008
increased 127.8 percent to $1,418,750 from $622,867 for the second quarter 2007
due primarily to the selling expenses for the new Tsining JunJing II project.

Other expenses

Other expenses for the three months ended June 30, 2008 decreased to no expenses
compared with $3,060 for the three months ended June 30, 2007. The second
quarter 2008 decrease was primarily due to the 2008 absence of the expenses
incurred in the second quarter 2007 associated with the normal added finishing
in the Tsining JunJing I and Tsining 24G projects desired by the customers to
reach final satisfaction.

Operating profit and operating profit margin

Operating profit for the second quarter 2008 decreased 81.4 percent to $573,019
from $3,077,474 for the second quarter 2007. The operating profit margin
decreased to 4.33 percent for the second quarter 2008 from 25.61 percent for the
second quarter 2007. The declines were due primarily to the incentive discounts
given to the first buyers in the new Tsining JunJing II to promote market
interest and encourage future sales for the project and to higher selling
expenses also for Tsining JunJing II.


                                       24
<PAGE>
Interest expense

Interest expense for the three months ended June 30, 2008 increased 114.0
percent to $658,443 from $307,651 for the three months ended June 30, 2007. The
increase for the three months ended June 30, 2008 was due primarily to the 2008
debt financing associated with the purchase in March 2007 of Xi'an New Land
Development Co., Ltd. (the "New Land") that owned the exclusive rights to
develop the Baqiao project and perform the related infrastructure construction.
The financings in 2007 and 2008 included the issuance of interest-bearing
convertible debt with warrants in January 2008 and the issuance of common stock
and warrants in the December 2007.

Change in fair value of warrants

In 2006, 2007, and 2008 the company issued warrants in conjunction with the
issuance of common shares or convertible debt. In the second quarter 2008,
shareholders did not exercise warrants to buy common shares. For the second
quarter 2008, the company was required to estimate the fair value of its
remaining warrants outstanding and adjust the value as needed, and it chose to
use the Cox-Ross-Rubinstein Binomial Lattice valuation model to estimate their
fair value.

The Change in fair value of warrants of $(946,563) in the second quarter 2008
consisted of (a) the cost to the company of the warrants issued in 2008, (b) a
result of the exercise of warrants during the quarter, of which there were none
exercised, and (c) the periodic adjustment to the estimated cost to the company
to provide the common shares, assuming that all the warrants will be exercised
sometime in the future. The basis for estimating the cost to provide those
common shares was provided by the valuation model.

Provision for income taxes

The effective tax rates for the second quarters of 2008 and 2007 were 8.64
percent and 33.63 percent, respectively.

Net income

Net income for the second quarter 2008 decreased 38.0 percent to $1,135,879 from
$1,830,880 for the second quarter 2007. The decrease in net income was due
primarily to two reasons. The first reason was the new Tsining JunJing II
project's higher selling expenses and the incentive discounts given to the
project's first buyers to promote market interest and encourage future sales.
The second reason was higher interest expense due to convertible debt issued in
March 2008 to help finance the 2007 acquisition of the company owning the
exclusive rights for the Baqiao project land and related infrastructure
construction project.

Six Months Ended June 30, 2008 Compared With Six Months Ended June 30, 2007

Revenues

Total revenues for the six months ended June 30, 2008 decreased 11.0 percent to
$17,991,127 from $20,214,787 for the six months ended June 30, 2007.

Effective January 1, 2008, the company adopted the percentage of completion
method of accounting for revenue recognition for all construction projects in
progress, which currently includes Project Tsining JunJing II.

Revenues by our major projects

Project Tsining JunJing II revenues for the six months ended June 30, 2008 were
$12,041,821 compared with no revenues for the six months ended June 30, 2007.
During the second quarter of 2008, Project Tsining JunJing II began above-ground
construction, which permitted all cash received from the pre-sales of housing
units to be recognized as revenues during the second quarter of 2008, consistent
with the percentage of completion method of accounting for revenue recognition.
The pre-sales of units began in September 2007 and the first revenue recognition
for this project occurred in the second quarter 2008.


                                       25
<PAGE>
Project Tsining-24G revenues for the six months ended June 30, 2008 decreased
99.9 percent to $18,555 compared with $16,849,377 for the six months ended June
30, 2007. The decrease was due to the absence of sale of the 24G project that
was completed in the second quarter 2007. The sale of the service apartments
portion of the building and most retail spaces were recognized in second quarter
2007 revenues. The revenues in the first half of 2008 resulted from the sales of
a few of the remaining available retail spaces. The decrease was due to the 24G
project being completed and most units were sold during 2007.

Project Tsining JunJing I revenues for the six months ended June 30, 2008
increased 170.9 percent to $4,621,178 from $1,705,767 for the six months ended
March 31, 2007 because we sold multiple floors in one building for a service
apartment business from the project in March 2008.

Revenues for the six months ended June 30, 2008 for Additional projects
decreased 80.1 percent to $121,122 compared with $626,245 for the six months
ended June 30, 2007. Additional projects primarily included small projects. The
decrease in Additional projects revenues was primarily due to the absence of the
second quarter 2007 sale of an previously occupied residential-commercial
building and the second quarter 2007 sale of several residential units in the
company's completed projects. The revenues recorded in the second quarter 2008
resulted from the sale of a few retail units from previously completed projects.

The Baqiao infrastructure construction project generated revenues of $686,897
for the six months ended June 30, 2008 compared with no revenue for the six
months ended June 30, 2007. The company acquired the infrastructure construction
project in March 2007, and the first revenues occurred in the fourth quarter of
2007. The revenues in the first half of 2008 consisted of the government's
allowance for interest income on the company's investments required to support
the infrastructure construction project, support continued river management, and
support suburban planning for the entire Baqiao high-technology industrial park.

Revenues by project:                     6 months ended      6 months ended
(US$ in millions)                             30-Jun-08           30-Jun-07

Projects
Tsining JunJing II                                 12.1
Tsining 24G                                                            16.8
Tsining JunJing I                                   4.6                 1.7
Additional projects                                 0.1                 0.6
Baqiao infrastructure construction                  0.7
Total Sales of properties                          17.5                19.1

Other income

Other income for the six months ended June 30, 2008 decreased 60.14 percent to
$411,952 from $1,033,399 for the six months ended June 30, 2007 primarily due to
the absence of a property clean-up project performed in second quarter of 2007.
The revenues in the first half 2008 consisted primarily of a property clean-up
project performed in the first quarter 2008 and sales of excess assets in the
second quarter 2008.


                                       26
<PAGE>
Cost of revenues

The cost of revenues for the six months ended June 30, 2008 decreased 6.5
percent to $13,619,833 compared with $14,566,647 for the six months ended June
30, 2007.

The lower cost of sales for the six months ended June 30, 2008 was primarily due
to the absence of the Tsining-24G project's cost of revenues that were
recognized using the full accrual method of accounting when the project was sold
in the first quarter 2007. In the first quarter 2008, Tsining JunJing I revenues
and cost of revenues were recognized due to the sale of multiple floors in one
building for a hotel business. In the second quarter of 2008, revenues and the
cost of revenues for Tsining JunJing II were recognized using the percentage of
completion method of accounting. The total of the cost of revenues from Tsining
JunJing I and II in the first half of 2008 was less that the cost of revenues
for Tsining-24G recorded in the first half of 2007 primarily because Tsining-24G
was a much larger project than the portions of Tsining JunJing I and II recorded
in the first half of 2008.

Gross profit and gross profit margin

Gross profit for the six months ended June 30, 2008 was 4,371,294, down 22.6
percent from $5,648,140 for the six months ended June 30, 2007. The gross profit
margin for the six months ended June 30, 2008 was 24.30 percent compared to
27.94 percent for the six months ended June 30, 2007.

The decreases in gross profit and gross profit margin were primarily due to the
first half of 2008 sales of residential units that had lower profit margins than
the premium-priced retail and residential units sold in the first half of 2007.
Most buildings sold in the second quarter of 2008 were in the Tsining JunJing II
residential project, which included the first units in the project that were
negotiated in 2007 at attractive prices to create buyer and market interest and
encourage future sales.

Selling, general, and administrative expenses

Selling, general, and administrative expenses for the six months ended June 30,
2008 increased 129.0 percent to $2,567,351 from $1,120,946 for the six months
ended June 30, 2007. The higher selling, general, and administrative expenses in
the second quarter 2008 were due primarily to the selling expenses for the new
Tsining JunJing II project.

Other expenses

Other expenses for the six months ended June 30, 2008 decreased to $15,910
compared with $35,679 for the six months ended June 30, 2007. The decrease was
primarily due to the 2008 absence of the expenses incurred in 2007 associated
with the normal added finishing in the Tsining JunJing I and Tsining-24G
projects desired by the customers to reach final satisfaction.

Operating profit and operating profit margin

Operating profit for the six months ended June 30, 2008 decreased 60.2 percent
to $1,788,033 from $4,491,515 for the six months ended June 30, 2007 due
primarily to lower gross profit on the residential Tsining JunJing II project,
the absence of profits from the Tsining-24G sold in the first quarter of 2007,
and higher selling expenses in the second quarter 2008 for Tsining JunJing II
that were absent in the second quarter 2007.

The operating profit margin decreased to 9.94 percent for the six months ended
June 30, 2008, compared with 22.22 percent for the six months ended June 30,
2007, primarily due to the first half 2008 absence of the operating profit
margin on the premium-priced Tsining-24G project and the attractive operating
profit margins on the retail and residential units also sold in the first
quarter of 2007, as well as the first half 2008 operating profit margins in the
Tsining JunJing II project that were moderate due to attractive prices used to
create buyer and market interest in the project and the higher selling expenses
for Tsining JunJing II that were absence in the first half of 2007.


                                       27
<PAGE>
Interest expense

Interest expense for the six months ended June 30, 2008 increased 113.0 percent
to $1,098,116 from $515,527 for the six months ended June 30, 2007. The increase
for the six months ended June 30, 2008 was due primarily to the 2008 debt
financing associated with the purchase in March 2007 of New Land that owned the
exclusive rights to develop the Baqiao project and perform the related
infrastructure construction. The financings in 2007 and 2008 included the
issuance of interest-bearing convertible debt with warrants in January 2008 and
the issuance of common stock and warrants in the December 2007.

Change in fair value of warrants

In 2007, and 2008 the company issued warrants in conjunction with the issuance
of common shares or convertible debt. The warrants permit the shareholders to
buy additional common shares at the prices specified in the warrant agreements.
In the six months ended June 30, 2008, shareholders exercised a total of 1,870
warrants to buy a total of 1,870 common shares. When a shareholder exercises a
warrant to buy common shares, typically only when the stock price is higher than
the warrant exercise price, the shareholder covers the exercise price and
Company covers the balance of the value to provide the common shares. In
addition, for the six months ended June 30, 2008, the Company was required to
estimate the fair value of its remaining warrants outstanding and adjust the
value as needed, and it chose to use the Cox-Ross-Rubinstein Binomial Lattice
valuation model to estimate their fair value.

The change in fair value of warrants of $(956,052) in the six months ended June
30, 2008 consisted of (a) the cost to the Company of the warrants issued in
2008, (b) a result of the exercise of warrants in February 2008, and (c) the
periodic adjustment to the estimated cost to the Company to provide the common
shares, assuming that all the warrants will be exercised sometime in the future.
The basis for estimating the cost to provide those common shares was provided by
the valuation model.

Provision for income taxes

The effective tax rates for the six months ended June 30, 2008 and 2007 were
24.70 percent and 33.83 percent, respectively.

The effective tax rate was lower compared with last year somewhat in the first
half of 2008 because Changes in the fair value of embedded derivatives and
warrants are not taxable.

Net income

Net income for the six months ended June 30, 2008 decreased 54.9 percent to
$1,183,564 from $2,623,382 for the six months ended June 30, 2007. The decrease
in net income was due primarily to four reasons.

The first reason was that most units sold in the first half of 2008 were
residential units with lower net profit margins than the retail and residential
units sold in the first half of 2007.

The second reason was selling expenses in the first half of 2008 for the Tsining
JunJing II project, which were absent in the first half of 2007.

The third reason was interest expense on convertible debt issued in March 2008
to help finance the 2007 acquisition of the company owning the exclusive rights
for the Baqiao project land and related infrastructure construction project.


                                       28
<PAGE>
The fourth reason is the first half 2008 absence of other income from a major
property clean-up project in the first half of 2007.

These four reasons that reduced net income were partly offset by the effect on
net income from the changes in fair value of warrants and the lower effective
income tax rate in the first half of 2008.

Basic and diluted earnings per share

Basic earnings per share were $0.04 for the six months ended June 30, 2008, down
63.6 percent from $0.11 for the six months ended June 30, 2007. Diluted earnings
per share were $0.02 for the six months ended June 30, 2008, down 81.8 percent
from $0.11 for the six months ended June 30, 2007.

Common shares used to calculate EPS

The weighted average shares outstanding used to calculate the basic earnings per
share were 30,143,161 shares for the six months ended June 30, 2008 and
23,453,110 shares for the six months ended June 30, 2007.

The weighted average shares outstanding used to calculate the diluted earnings
per share were 30,304,679 shares for the six months ended June 30, 2008 and
23,527,132 shares for the six months ended June 30, 2007.

The increases in the weighted average shares outstanding used to calculate basic
and diluted earnings per shares for six months ended June 30, 2008 compared with
six months ended June 30, 2007 were due to the common shares and warrants issued
in December 2007 and the convertible debt and warrants issued in January 2008.

Gain on foreign exchange

The company's subsidiaries operate in China and account for their operations
using the Chinese Renminbi("RMB"). The company translates the results of its
subsidiaries into U.S. dollars based on the exchange rates of the two currencies
and reports its financial results in dollars. During the first half of 2008, the
renminbi appreciated in value against the dollar, which when translating the
operating results and financial positions of the subsidiaries at different
exchange rates created the accrued gain on foreign exchange.

Cash flow discussion

Net cash from operating activities provided $(7,997,053) in the first half of
2008 compared with $4,454,481 provided in the first half of 2007 primarily due
the increase in the costs for the new Tsining JunJing II construction in 2008.

Net cash from investing activities provided $(1,630,906) in the first half of
2008 compared with $1,299,834 provided in the first half of 2007 primarily due
to the decrease of the restricted cash in 2008.
Net cash from financing activities provided $29,270,443 in the first half of
2008 compared with $1,646,838 provided in the first half of 2007 primarily due
to the issuance of convertible debt and warrants and construction loans from
banks, partly offset by payments on loans payable to New Land's previous
shareholders in the first half of 2008.

As a result of the above net cash changes from operating, investing, and
financing activities, the increase in cash for the first half of 2008 was
$19,662,484 compared with $7,401,153 for the first half of 2007.


                                       29
<PAGE>
Debt leverage

Total debt outstanding as of June 30, 2008 was $53,095,880 compared with
$27,922,125 as of December 31, 2007. Net debt outstanding (total debt less cash)
as of June 30, 2008 was $27,713,994 compared with $25,469,759 as of December 31,
2007. The company's net debt as a percent of total capital (net debt plus
shareholders' equity) was 27.60 percent on June 30, 2008 and 27.79 percent on
December 31, 2007. The increase in net debt as a percent of total capital was
primarily due to the issuance of convertible debt and warrants in January 2008
and the construction loans proceeds in June, 2008.

Total debt consists of the sum of the balance sheet lines titled, "loans payable
to New Land's previous shareholders", "loans from employees", "loans payable and
convertible debt".

Liquidity and Capital Resources

Our principal demands for liquidity are for development of new properties,
property acquisitions, and general corporate operation purposes.

As of June 30, 2008, we had cash and cash equivalents in the amount of
$25,381,886, an increase of $22,929,520 compared to $2,452,366 of cash and cash
equivalents on hand as of December 31, 2007.

Financial obligations

As of June 30, 2008, we had total bank loans of $29,595,720 with a weighted
average interest rate of 9.66 percent. Future scheduled maturities of loans
payable are as follows:


           29-Aug-08          -   $5,540,085
           31-Dec-08          -   $5,831,669
           14-Jun-09          -   $3,644,793
           14-Jul-08          -   $14,579,173

The loans are secured by the assets of the Company.

Loans payable

Loans payable represents amounts due to various banks and are due on demand or
normally due within one year. These loans generally can be renewed with the
banks when the loans mature.

Most of the obligations of the company are tied to specific projects. The terms
of the loans are typically 1 to 1.5 years. Loan extensions are determined by
mutual agreement when the current term expires and both parties will consider
the remaining time needed to complete the project. Most of these loans are
payable when the project has been completed and the residents or businesses take
possession.

The following table summarizes the Company's loans payable that were outstanding
as of June 30, 2008:

(Millions of dollars)       Balance       Interest rate           Due date

Commercial Bank Weilai      $5.50                11.34%           29-Aug-08
Commercial Bank Weilai      $5.80                 9.79%           31-Dec-08
Xi'an Rural Credit Union    $3.60                 9.53%           14-Jun-09
China Construction Bank     $14.60                9.00%           14-Aug-08

The annual interest requirement on these loans totals about $1.4 million.


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The following table summarizes the amounts and types of the Company's
obligations and provides the estimated period of maturity for the financial
obligations by class as of June 30, 2008:

Obligations Due by Period                   1 yr        1-3 yrs         4-5 yrs
(Millions of dollars)

Current liabilities

Accounts payable                           $15.70
Income and other taxes payable                          $25.20
Other payables                                           $4.90
Advances (deposits) from customers                       $9.50
Accrued expenses                            $2.90

Long-term liabilities

Warranties liabilities                                                  $5.10
Deferred tax                                            $16.40
Fair value of embedded derivatives                                      $3.50
Convertible debt                                                       $13.10

Long-term debt

Loans payable                              $29.60
Loans payable to New Land's
previous shareholders                                    $8.60
Loans from employees                                     $1.90
Liquidity expectation

The Company believes that the combination of present capital resources,
internally generated funds and unused financing sources are adequate to meet
cash requirements for the year 2008.

We intend to meet our liquidity requirements, including capital expenditures
related to the purchase of land for the development of our future projects,
through cash flow provided by operations and additional funds raised by future
financings. Upon acquisition of land for future development, we intend to raise
funds to develop our projects by obtaining mortgage financing from local banking
institutions with which we have done business in the past. We believe that our
relationships with these banks are in good standing and that our real estate
will secure the loans needed. We believe that adequate cash flow will be
available to fund our operations.

As part of our funding plan, on March 9, 2007, we entered into a Shares Transfer
Agreement with the shareholders of Xi'an New Land Development Co., Ltd. (the
"New Land"), pursuant to which we have acquired 32,000,000 shares of the New
Land, constituting 100 percent equity ownership of the New Land.

The New Land is now in cooperation with the Baqiao District Government of Xi'an
City in developing the Baqiao Science & Technology Industrial Park, a provincial
development zone in Shaanxi Province. This acquisition has been completed, and
the Company has the right to develop and sell 487 acres of property which has
been targeted for new residential developments.

The majority of the Company's revenues and expenses were denominated primarily
in Renminbi ("RMB"), the currency of the People's Republic of China. There is no
assurance that exchange rates between the RMB and the U.S. Dollar will remain
stable. The Company does not engage in currency hedging. Inflation has not had a
material impact on the Company's business.


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<PAGE>
Other Events

Beginning in mid-September 2007, the Company started the first round to offer
selected `club members' the opportunity for an initial cash payment of 100,000
RMB or approximately $13,300 USD to secure a purchase right for a unit in the
highly sought after Tsining Junjing II development. And, in mid-April 2008, the
Company started the second round to offer selected `club members' the
opportunity to secure a purchase right for a unit in the highly sought-after
Tsining Junjing II development. As of August 10, 2008, more than 522,345 square
footage were pre-sold, constituting $27.63 million of revenue. In the first
round of offering, there were 406 units of more than 440,478 square footage
pre-sold, constituting $ 21.38 million of revenue and the average price was over
$48.55 per square footage. In the second round, there were 55 units of more than
81,867 square footage pre-sold, constituting $ 6.25 million of revenue, and the
average price was over $76.34 per square footage. So far, we have received over
$23.78 million in cash deposits. The Company will use these proceeds as working
capital. Once the units are complete and the titles are officially transferred
to the new owners, which is anticipated to occur late next year, the buyers will
be responsible for a balance of approximately $40,000 for each unit at the time
of closing and officially consummate the purchase of the unit. There are risks
that certain pre-sale units may not reach final closings, and if the
transactions cannot close in 2008, a portion of the deposits may be returned to
customers. Pre-sales are customary in China, which enable developers to have
visibility of the sell-through rates, while providing capital to complete
projects that augments overall internal rate of return.

On July 7, 2008, the company signed a strategic partnership agreement with the
China Construction Bank Shaanxi Branch that establishes a 1 billion RMB credit
line for construction loans to support the construction work of China Housing
and its subsidiaries. The new strategic partnership is the first and only one of
its kind for both the Company and China Construction Bank Shaanxi Branch. The
agreement also establishes the Company's status as a VIP client for the bank.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company is subject to the following market risks, including but not limit
to:

General Real Estate Risk

There is a risk that the Company's property values could go down due to general
economic conditions, a weak market for real estate generally, or changing supply
and demand. The Company's property held for sale is of a value of approximately
$13.7 million as of June 30, 2008, which may change due to market price
fluctuations. Currently, it is valued significantly below the normal market
value. The Company may not be able to sell a property at a particular time for
its full value, particularly in a poor market.

Foreign Currency Exchange Rate Risk

The Company is doing all its business in P.R. China. All the revenue and profit
are denominated in RMB. When RMB depreciates, it may adversely affect the
company's financial performance. Since the Company's recent $20 million senior
convertible note interest payment is denominated in US dollars, the depreciation
of RMB may incur additional cost to our financial cost.

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Item 4T. Controls and Procedures

Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that information
required to be disclosed in reports that we file or submit under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in the rules and forms of the United States Securities
and Exchange Commission. Our Chief Executive Officer and Chief Financial Officer
have reviewed the effectiveness of our "disclosure controls and procedures" (as
defined in the Securities Exchange Act of 1934 Rules 13a-14(c) and 15d-14(c))
within the end of the period covered by this Quarterly Report on Form 10-Q and
have concluded that the disclosure controls and procedures are effective to
ensure that material information relating to the Company is recorded, processed,
summarized, and reported in a timely manner. There were no significant changes
in our internal controls or in other factors that could significantly affect
these controls subsequent to the last day they were evaluated by our Chief
Executive Officer and Chief Financial Officer

Changes in Internal Control over Financial Reporting

During the fiscal quarter ended June 30, 2008, there have been no changes in the
Company's internal control over financial reporting, identified in connection
with our evaluation thereof, that have materially affected, or are reasonably
likely to materially affect, its internal control over financial reporting.


Part II. OTHER INFORMATION

Item 1. Legal Proceedings

Not applicable

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable

Item 3. Defaults Upon Senior Securities

Not applicable

Item 4. Submission of Matters to a Vote of Security Holders

Not applicable

Item 5. Other Information

Not applicable

Item 6. Exhibits

(a) Exhibits

Exhibit
Number         Description of Exhibit
-------------------------------------------------------------------------------

31.1           Certification of Principal Executive Officer pursuant to Rule
               13a-14 and Rule 15d-14(a), promulgated under the Securities and
               Exchange Act of 1934, as amended

31.2           Certification of Principal Financial Officer pursuant to Rule
               13a-14 and Rule 15d 14(a), promulgated under the Securities and
               Exchange Act of 1934, as amended

32.1           Certification pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(Chief
               Executive Officer)

32.2           Certification pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(Chief
               Financial Officer)


                                       33

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                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                China Housing & Land Development, Inc.


August 14, 2008                 By:     /s/ LU PINGJI
                                     -----------------
                                     Lu Pingji
                                     Chief Executive Officer
                                     (Principal Executive Officer)




August 14, 2008                 By:     /s/ William Xin
                                     -------------------
                                     William Xin
                                     Chief Financial Officer
                                     (Principal Financial and
                                     Accounting Officer)




                                       34

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