(Bloomberg) -- China will “strictly” ban property developers and real estate agencies from financing down-payments for home purchases, the state-run Xinhua News Agency reported, citing the housing ministry.
The report on Friday also said the government will step up anti-money laundering efforts in the real estate industry and stop individuals misusing consumer loans for home purchases.
Banks should manage mortgages and consumer loans separately, and closely monitor borrowing through credit cards, the report said. It also warned against Internet finance companies and microlenders illegally providing financing.
Developers tumbled a week ago when Caixin reported that officials had stepped up checks connected to down-payment loans. Investors are weighing developers' prospects after stratospheric share price gains this year, with China Evergrande Group up 505 percent and Sunac China Holdings Ltd. gaining 475 percent. The industry is consolidating and the government is trying to rein in home prices.
To contact Bloomberg News staff for this story: Jun Luo in London at jluo6@bloomberg.net.
To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at sbhaktavatsa@bloomberg.net, Paul Panckhurst, Sam Mamudi
©2017 Bloomberg L.P.
With assistance from Jun Luo
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