Beijing - Xinhua
New property-related loans continued to shrink in China in the third quarter of this year, adding to realty companies\' capital strains, according to data from the People\'s Bank of China (PBOC). New property-related loans, which include loans to property developers and mortgage loans to home buyers, totaled 992.3 billion yuan (156.78 billion U.S. dollars) between January and September, down 42.8 percent from a year earlier, according to the PBOC, China\'s central bank. Outstanding property-related loans stood at 10.46 trillion yuan at the end of September, up 14.6 percent year-on-year. On a quarterly basis, mortgage loans have kept falling in China this year after the Chinese government introduced a series of measures to rein in soaring inflation and cool down the runaway property market. Loans amounted to 201.1 billion yuan in the third quarter, 281.7 billion yuan in the second quarter and 509.5 billion yuan between January and March, according to the PBOC. Zhang Dawei, a senior researcher with the Centaline Property Agency Limited (Beijing), said real estate developers are facing greater difficulty accessing financing, with limited credit lines and higher borrowing rates from banks, according to the Beijing News newspaper. \"Home sales are falling and inventories building up. Real estate developers, especially those small and medium-sized firms, are under unprecedented pressure,\" Zhang said. More than 2.6 trillion yuan of liquidity has been frozen for banks to make loans after the PBOC raised the benchmark interest rates three times and hiked the required reserve ratio for commercial banks six times this year to mop up excessive liquidity and curb inflation. The monetary and credit-tightening policies will continue to reduce realty-related loans and affect developers\' sales, thus increasing their financing strains, in the coming six or 12 months, the Standard & Poor\'s (S&P) financial services company said in a report this week. S&P said the Chinese central government was not likely to loosen its policies in these areas in the near future and therefore developers\' exposure to financing problems will heighten.