Housing speculators will find it difficult to escape China's tougher criteria on second-home mortgages. Housing and lending regulators and the central bank have jointly issued new rules.

They require banks to consider both the mortgage and home purchase records of people applying for second mortgages. Analysts say the new measure may cool housing prices.

For the first time, China is including home ownership records in determining second home mortgages. This means buyers can no longer bypass higher interest rates or down payment requirements. There's also a penalty for out-of-town home owners who haven't paid income tax or social security funds in the previous 12 months in the place of purchase. They'll have to come up with a 50-percent down payment and an interest rate of 1.1 times of the benchmark rate.

Analysts say for big cities like Beijing and Shanghai, the two measures will curb speculation. Take Beijing for example. Half of home buyers have mortgage or home purchase records.

Another 10 to 20 percent fall into the category of not having paid income tax or social security funds in the previous year. So the new rules apply to more than 70 percent of home buyers in Beijing.

Chen Yunfeng, Huaye Real Estate, said, "The new rules will dampen home sales. Property developers will find it hard to get their investment back. So they may offer discounts."

Zhang Haiming, Homelink real estate, said, "Now the market is full of liquidity. Hot money can be found everywhere. The new rules set a dam between the real estate market and bank loans. It can prevent hot money from entering property market. Raising the threshold could change the supply and demand."

The new rules mean home buyers who aim to improve their living conditions will no longer enjoy preferential policies either.

Zhang said, "According to the new rules, even if a home owner who has mortgage record sells his home and wants to buy a new one, he'll also have to face tougher rules."

Analysts also say the tough measures the new rules can effectively crack down on speculation.

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