China Urges Banks To Support Property Sector

China's banking regulator has urged lenders to extend more credit to real estate developers, as a growing number of homebuyers withhold mortgage payments on unfinished housing projects across 50 cities.

The China Banking and Insurance Regulatory Commission (CBIRC) told the official industry newspaper on Sunday that banks should meet developers' financing needs where reasonable.

The CBIRC expressed confidence that with concerted efforts, "all the difficulties and problems will be properly solved", the China Banking and Insurance News reported.

The remarks come as homebuyers, who are furious at postponed deliveries of pre-sold homes, unclear delivery times and stalled construction, halted payments for already sold units in at least 100 residential projects last week, according to data from industry groups and analysts.

The CBIRC had earlier vowed to strengthen its coordination with other regulators to "guarantee the delivery of homes".

Official data on Friday showed output in the property sector shrank 7 percent in the second quarter from a year earlier, marking the fourth straight quarter of decline.

New real estate loans in June were expected at more than 150 billion yuan, compared with a contraction in May, CCTV reported on Monday. (Agencies)