The recent directive issued by the central government requiring mainland property agencies to set up special bank accounts to hold clients' money during transactions would aid regulation of the market, foreign-backed property agents said. However, they believe it will be months before local authorities announce detailed measures on implementing the new instructions. Last week, the Ministry of Construction and the People's Bank of China jointly issued a statement on the requirement. All transactions should be conducted through the designated bank. A ministry spokesman also suggested homebuyers sign a contract with property agents to list their responsibilities before their appointment to any brokerage business. 'The move is aimed to stop malpractice in the market. In the past, some agents have used a buyer's deposit to speculate on property deals or even invest in stock,' said Philip Wu Kong-man, the general manager of City Integrated Residential Services, a member of property consultant DTZ. Mr Wu said the use of such bank accounts was similar to the Estate Agent Trust Account required by the Hong Kong Estate Authority. In Hong Kong, property agents are required to open the accounts that will safely hold all monies received by them on behalf of their clients and they are prohibited from using the money for other purposes. The statement gave no indication when the policy will take effect. Local housing and land administration bureaus will be responsible for inspecting the bank accounts. Centaline (China) Property Consultants director Sherman Lai Ming-kai said he welcomed the move. 'All foreign-backed property agents and big mainland agents will not be able to misuse clients' money for other investments. The new move will regulate the market back into a healthy mode,' Mr Lai said. However, many of the details have yet to be finalised, he said. 'For example, which authority will monitor that a buyer's money is being safely held in the bank and not being used by agents? The local authorities have not finalised their decision and I believe it will take more than six months before all the details are known,' he said. The malpractice crackdown is seen as part of the central government's measures to regulate the property market and cool off property speculation. In October last year, the Beijing city government announced a policy restricting some of the operations of property agencies in the secondary market. Under the guidelines, property agencies were barred from inflating the vendor's selling price to a buyer and profiting on the price difference and from using client deposits for short-term speculation. In November last year, more than 200 domestic and foreign property agencies in Beijing - including Centaline China (Beijing), Golden-keys, Wo Ai Wo Jia and Lian Jia pledged to stop capitalising on the price differences in the secondary housing market after the rules were announced.