China tightens rules on pre-payments for new properties

BEIJING (Reuters) - China has ordered property developers not to accept pre-payment for uncompleted homes without official approval, the latest in a series of moves aimed at quelling the red-hot real estate sector, state media reported.

The rule on pre-payment was published in a circular from the Ministry of Housing and Urban-Rural Development, Xinhua news agency reported late on Monday.

The ministry added that the government will strictly punish developers who deliberately raise house prices by delaying the proposed sales dates.

Chinese shares tumbled nearly 5 percent on Monday after Beijing stepped up its campaign to rein in soaring housing prices, with the government making mortgages harder to obtain.

Reporting by Aileen Wang and Simon Rabinovitch