More Chinese banks stop mortgage loans as quotas run out
Survey shows the trend that started in top-tier cities has extended to 17 areas as quotas run out and authorities tighten restrictions on prices

More mainland banks have stopped extending mortgage loans as their annual lending quotas run out and a rising number of cities tighten curbs on housing prices.

Meanwhile, nine cities - with Xiamen, Nanchang and Shenyang the latest additions on Monday - announced fresh measures in the past two months to contain soaring home prices. The measures include a cap on the asking prices of projects up for pre-sale approval and higher deposit and stricter purchase restrictions targeting non-local residents.
"From a policy perspective, property controls will get reinforced," the Rong360 report said. "For example, there is rising expectation of property tax getting expanded.
"Banks right now may have well underweighted the property market, so they are cutting mortgage loans to reduce risk."
Intensifying cooling policies pushed down property shares yesterday, with China Vanke, the mainland's biggest homebuilder, down 0.8 per cent in Shenzhen, and China Overseas Land & Investment, another industry leader, also shedding 0.8 per cent in Hong Kong.
New bank loans to the property sector surged in the first nine months of this year to 1.9 trillion yuan (HK$2.4 trillion), including 1.37 trillion yuan of mortgage loans, adding fuel to housing inflation and forcing local officials to roll out fresh cooling measures as home prices surged out of the leadership's comfort zone.
