The resumption of credit controls on home loans by Hangzhou banks has sent shockwaves through the mainland property market, igniting fears of a clampdown on the current recovery by the central government.

Heightening these concerns were reports this week of a follow-up move by lenders in Nanjing to re-impose the controls that were originally introduced by the central government in September 2007. At the time, the People's Bank of China ordered banks to require buyers of second homes to make a minimum up-front payment of 40 per cent instead of 30 per cent to qualify for a loan, and to charge a 10 per cent premium on benchmark mortgage lending rates.

South China Morning Post