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China to Restrict Foreign Ownership of Property

BEIJING-China plans to clamp down on foreign investment in property in an attempt to cool an overheating market.

By Anita Howarth | Updated on July 05, 2006

(For more retail coverage, click GlobeSt.com/RETAIL, and for multifamily updates, click here.)

BEIJING-Are your investment bags packed for a trip to the Far East? You might want to rethink your travel plans. The Chinese government plans to restrict property acquisitions by foreign investors in a bid to limit speculation and prevent a property bubble, a government official says.Lin Zheying, deputy director general of the commerce ministry’s Foreign Investment Administration, told a press conference that new rules spelling out what type of overseas investor can buy property may be announced this month.

The regulations may threaten plans by investors including Citigroup Inc. and Morgan Stanley to increase holdings of Chinese real estate after Shanghai housing prices more than doubled since 1999. Premier Wen Jiabao has curbed lending to cool an economy that grew 10.3% in the first quarter and to prevent a drop in property prices from causing loan defaults.

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