China targets speculators at high-end of the property market

The China Banking Regulatory Commission has reportedly told commercial lenders to help stamp out speculative property purchases by raising interest rates on third home mortgages as well as requiring larger down payments on the loans. The move targets high-end housing where speculation is rife, and not the mid-tier market.

The announcement comes as the government begins shifting the gears of austerity measures aimed at cooling spiraling residential property prices without putting a stop to an industry that accounts for about 20% of economic growth. Property speculation and land hoarding are two areas often cited as being responsible for galloping prices.