February 13, 2017 / 12:50 PM / 6 months ago

Chinese association bans some types of property investment in 16 cities

BEIJING, Feb 13 (Reuters) - China's asset management association has banned registration of private equity schemes for residential property investment in 16 cities where it says the market has overheated.

The cities include Beijing, Shanghai, Guangzhou, Shenzhen and Xiamen, according to a notice published on Monday on the Wechat account of the Asset Management Association of China.

The self-regulatory organisation will bar private equity investors from using trust and other financing services to fund real estate developers for land purchases and working capital, it said in the notice.

Real estate investment in China rose 6.9 percent in 2016, according to official data published last month, the strongest annual growth in seven years.

Authorities have rushed to dampen home prices in the biggest urban markets by implementing a series of buying and ownership restrictions, aiming to prevent a sudden correction that could damage the broader economy.

China's banks in some big cities also are lowering discounts on lending rates for first-time home buyers, in order to tighten property sector credit. (Reporting by Matthew Miller; Editing by Ruth Pitchford)

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