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. After senior leader Mr Deng Xiaoping urged an acceleration in economic reforms last year, the city Government relinguished the authority over land leasing to the district level. But the move overheated the property market, attracting both sound and shaky developers and fuelling speculation. The last year's sale of 201 plots brought the district Government HK$22.3 billion, with a $20.6 billion coming from foreign investors - 70 per cent of which were based in Hongkong. Out of the total plots leased, 29 were 15.18 million sq m and located in Pudong. The other 172 sites measuring 5.42 million sq m, are located in Puxi. At the end of last year, the city moved to clamp down on market speculation. It took back the leasing authority and restricted the number of plots avialable on the market. In addition, there have been many disputes between existing residents and developers over specific projects. Last September, the city introduced legislated stating that the clearing of land where 200 families reside has to be handled by the Government. ''This year, the Government will launch a very limited numbers of plots, less than 100 plots. In fact, there isn't much land available in the city,'' Mr Chan said. He said banks would restrict loans following guidelines laid down by Beijing. ''The developers will not receive bank loans as easily as last year.'' He predicted that most land leased in 1993 would be located at Jinqiao and Lujiaju. At present, commercial land in Shanghai is leased for 50 years and residential property for 70 years. The most expensive land is at Waitan and Lujiaju. Waitan, located at the prime area of the city centre, is known as Shanghai's ''old city'' because of its importance as a financial hub before the communist takeover in 1948. Most government authorities are still situated there. A master plan to develop Pudong into a economic zone has been approved, but infrastructure projects have yet to be completed. Many foreigners have expressed interest in the zone, few have established businesses. ''Pudong is very preliminary. Investors are taking a wait-and-see attitude,'' said Mr Chan. Lujiazui - at the core of the development site - will be the financial, commercial, office and foreign services area, while Waigaoqiao and Jinqiao are planned as industrial districts. ''Compared with other cities, Shanghai's property regulation is well developed. The price for land leased will be levelled off this year. But in 1994 and 1995, the market will have another boom,'' he added.