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Controls to curb property price rise

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SHANGHAI'S property market is set for a correction this year, following a series of policy changes aimed at centralising government control and curbing speculation.

While the city leased 201 plots of land totalling 20.6 million square metre last year - compared with only seven plots in 1991 - the number of plots on the market this year will be limited.

''The city government has taken back the power over land leasing from the district government. The supply of land will be limited. The Government will not launch more than 100 plots this year,'' said Mr David Chan Sun-fat, managing director of CERD Property Development.

He predicted this new limit would force many developers into bankruptcy.

''Some banks in the city believe that many financially troubled developers will be forced to sell off their property projects at a big discount. So the bankers have reserved something like tens of billions yuan to pick good bargains,'' he said.

Shanghai's property market was opened in 1988, when the city leased the first plot at Hongqiao to a Japanese investor - Japan Sun's Corp.

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