China checks banks' compliance with property curbs

BEIJING: Chinese regulators are making spot checks on whether banks are strictly complying with government curbs on mortgages for non-owner-occupied homes, state media reported on Tuesday, Sept 28.

The inspections — by the China Banking Regulatory Commission and the housing ministry — are being conducted in big cities, including Beijing, Shanghai and Guangzhou, the Financial News reported, citing local banking regulators.

Regulators will also check that banks are complying with tougher rules on lending to property developers, the report said.

Beijing has rolled out a slew of measures since April to tame property inflation, including higher down payments and mortgage rates for second homes.

The results of the examinations will help determine the next stage of the government's policies, the paper said.

With property transactions and prices showing signs of a rebound in recent weeks, some industry experts expect Beijing to tighten further.

As part of its efforts to curb speculation, China may soon launch a long-awaited property tax, the Shanghai Securities News said on Tuesday. It did not give a firm timetable.

Speculation of such a tax has swirled for years, and a rash of reports suggesting the authorities are close to proceeding has weighed on the domestic stock market in recent months.

However, a number of analysts believe the authorities need more time to make technical preparations.

China's land ministry and housing ministry said in a joint circular over the weekend that they would ban developers from buying land if they were found to have hoarded land for more than a year or to have illegally transferred land. — Reuters