China’s recent cooling measures to curb real estate price growth have negatively affected foreign institutional investors, the China Daily reported.
Last year, China’s Ministry of Commerce ordered local authorities to stop approval of some foreign property investments to curb speculation amidst a huge influx of foreign investment in China’s real estate sector.
Local authorities are also required to strengthen their reviews of foreign exchange inflows for real estate transactions.
David Edwards at LaSalle Investment Management, a US real estate fund with US$45 billion under management, said, “We’ve investigated a number of projects since the last quarter of 2010. Though reducing market liquidity has made the price of assets more attractive, the tightening regulations have made investment much more difficult.”
Property Report, however, points out that statistics from the Ministry of Commerce show that foreign investment in the nation’s property sector rose to US$20.1 billion in the first 11 months of 2010, a 48% increase and close to three times the increase in the country’s total overseas capital inflows.