Chinese property stocks plunged in Hong Kong after a raft of mainland cities added housing curbs, wrongfooting investors betting that the government’s next step would be to ease restrictions. Eight cities including Chongqing and Nanning rolled out curbs over the weekend, with most banning home resales within two to three years of purchase, the official Xinhua News Agency reported. Shanghai-based Tospur Real Estate Consulting said six more may follow suit, without naming them. A Bloomberg index of 22 developers tumbled 7.5% as of 1:50 p.m. on Monday, heading for its steepest drop in more than two years and taking some of the air out of valuations for stock market stars such as China Evergrande and Sunac, which have climbed fivefold and fourfold, respectively, this year. The latest wave of tightening comes only a week after official data showed home price gains in fewer Chinese cities, fueling optimism that the authorities may be able to limit additional property curbs.
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