Business / Industries

China's property loans surge in Q3, home prices curbed

(Xinhua) Updated: 2016-10-22 10:46

BEIJING - Loans to the real estate sector grew fast in the first nine months, central bank data showed Friday, while the property market as a whole is showing signs of cooling following new restrictions.

By the end of September, financial institutions in China had lent 25.33 trillion yuan ($3.74 trillion) to the property sector, up 25.2 percent year on year, according to a report from the People's Bank of China.

Outstanding loans for real estate development amounted 7.04 trillion yuan at the end of September, up 7.6 percent year on year and slowing by 0.4 percentage points on a monthly basis.

Loans for individual purchases jumped 33.4 percent to 17.93 trillion yuan.

The data came after drastic price rises in 15 first- and second-tier cities have been "markedly contained" by policies to curb property price growth, according to the National Bureau of Statistics (NBS).

Compared with September, the month-on-month price index for new residential property purchases retreated this month for cities including Beijing and Shanghai, NBS said.

China's economy grew 6.7 percent in the third quarter, with the property sector owning about eight percent of the growth, NBS spokesperson Sheng Laiyun said Wednesday.

While the property sector has proved to be a significant growth driver so far, policymakers must walk a fine line to guide market expectations, since either an asset bubble or a sharp correction could increase risks to the broader economy.

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