Shanghai tightens housing rules

TO GO WITH: China-economy-property,FOCUS by Bill Savadove In a picture taken on October 9, 2011 labourers work at a new property development under construction on the busy Nanjing Road shopping street in Shanghai. China has invested heavily in property -- about $750 billion in 2010 alone -- since it privatised the market in the late 1990s, ending decades of state allocated housing and enabling a growing middle class to own their own homes. A massive stimulus package unveiled in late 2008 to combat the global financial crisis also triggered a flood of credit into the world's second largest economy, with a large portion funnelled into construction. AFP PHOTO/Mark RALSTON

BEIJING: Shanghai will raise the minimum down payment for second-home purchases to 70% from 60% in a bid to calm surging home prices, according to the city’s housing bureau, following similar moves by other big cities in China.

Home prices in large Chinese cities have set records, despite a four-year long government campaign to cool the property market, raising concerns over a potential price bubble and even social unrest as housing becomes increasingly unaffordable for many people.