Property developers facing financing difficulty

09:19, December 08, 2010      

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Property developers, especially the small and medium sized ones, are facing increasing pressure with less loans going to the real estate market.

Developers in Shanghai are falling on hard times, as the lending in the property sector has been steadily slowing down since the beginning of this year. According to official data, first quarter loans were at 73.5 billion yuan, second quarter lending dropped to 33.5 billion and only 3.7 billion were loaned out in the third quarter.

For property developers, the picture is even bleaker. The first quarter, they got just less than 36 billion in loans from the total. Second quarter saw only 12 billion; and in the third, a mere 2 billion yuan.

Yan Qingmin, CBRC Shanghai Bureau Chief said "The data suggests that our efforts to curb excessive lending to developers have proved effective."

Since the beginning of the year, local authorities have urged the city's banks to act in adherence to the Banking Regulatory Commission's guidelines to tighten credit.

Measures have included rejecting loan applications from businesses confirmed to have engaged in speculative buying, and developers involved in hoarding properties to jack up prices.

Source: CNTV.cn

(Editor:李佳)

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