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China could be looking at fresh property cooling measures

Flickr photo by Philip Jägenstedt

As a response to still-rising home prices.

According to BBVA, rumors of new policy curbs in China’s property market circulated in social media sites today.

"Housing prices have recently rebounded under looser credit conditions and improving market sentiment. NBS monthly property data will be released on Friday; in the meantime, we estimate that average nation-wide prices have risen by a modest 1.0% since May 2012," BBVA said.

"If confirmed (which we think unlikely), new measures could include increases in down-payment requirements on second home purchases, (currently 60%) and/or increases in mortgage rates (currently not allowed to be set more than 110% below the benchmark lending rate). The last significant round of such tightening measures occurred in January 2011. In response to the rumors, the Shanghai property index fell by -4.6% today," it said further.

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