Shares in China property companies have been slumping lately on concern tightened access to loans will force them to cut prices. Greentown China Holdings Ltd. plunged almost 20 percent in Hong Kong this week, the most in almost three years. Greentown, the largest builder in the eastern province of Zhejiang, yesterday denied media reports the banking regulator ordered trust companies to provide details of their business dealings with the company and its units.
“We’re reaching a tipping point where land sales aredropping much faster than before, developers are losing moreaccess to bank financing, and housing prices are showingweakness,” Nomura’s Zhang said in an interview in Beijingyesterday.
Developer Dalian Rightway Real Estate entered preliminary restructuring talks with lenders after missing a loan repayment, the Hong Kong-based South China Morning Post newspaper reported Sept. 9, citing three unidentified people involved in the situation.

Funding problems are just “the tip of the iceberg” and “sharp declines in property sales and prices are likely in the next two to three months,” said Shen Jianguang, an economist at Mizuho Securities Asia Ltd. in Hong Kong.
Apparently, the “construction ponzi scheme” is starting to unfold.
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