The People's Bank of China cut the down payment for first home buyers to 25 per cent from 30 per cent on Wednesday in another move to stimulate housing demand, and analysts anticipate more steps will follow to help speed up destocking. The latest move would not apply to the four tier-one cities - Beijing, Shanghai, Guangzhou and Shenzhen - or Sanya in Hainan province, where home purchase restrictions would remain in place, the central bank said. Because of those exclusions, "the impact of the new measure is rather limited", said Edison Bian, the head of China property research at UOB Kay Hian. In China's plethora of small cities, insufficient demand outweighs cheaper mortgage loans in efforts to sell down heavy housing inventories, he added. Policies for families borrowing from government-subsidised housing provident funds have already been made even looser, with down payments set at 20 per cent for first home buyers. China's benchmark mortgage rates are now at record low levels after four rate cuts this year and economists expect a fifth reduction in the next few months. Although developers have been competing intensively for parcels of land in tier-one cities, their overall land acquisitions across the country fell 32 per cent in the first eight months from a year earlier, in terms of floor space. The inventory overhang has also dragged down real estate investment, which directly accounts for 15 per cent of the nation's gross domestic product and affects more than 40 other industries. Xinyuan Real Estate, a mid-sized developer with projects mainly in tier-two and tier-three cities, would make destocking a priority for the rest of this year, and cut prices if necessary, its chief financial officer George Liu told the South China Morning Post . The PBOC said it would provide flexibility for central bank branches across the nation to decide, together with local governments and local branches of the China Banking Regulatory Commission, the final minimum deposits mainland families would need to put down when buying their first homes. The announcement came after some private data showed disappointing property sales in September, sparking concern about the sustainability of China's policy-induced housing recovery, and the prospect of further economic woes if more supportive policies are not rolled out. The final numbers are scheduled to be announced by the National Bureau of Statistics in mid-October. But property analyst Ning Jingbian at mainland investment bank CICC said in a research note last month he expected property sales in the mainland's top 30 cities to increase about 5 per cent in September from August.