An official from the China Securities Regulatory Commission, China’s securities regulator, told a training session for sponsor institutions on July 25 that funds raised by property companies from refinancing projects should not be used for buying land and repaying bank loans, but rather used strictly for real estate construction, according to people.com.cn.

In China, refinancing generally refers to direct financing conducted by a listed company through rights issue, private placements, and bond issue, among others.

Analysts said that the move signals the government’s determination to keep a tight lid on property companies’ furious land buying endeavors by tightening financing policies, and to some extent, wishes to curb asset bubbles in the real estate industry.

However, they pointed out that in practice it would be very hard for the government to monitor the actual utility of funds raised by these enterprises.

According to statistical data from Wind Info, a Shanghai-based Chinese data provider, a total of 21 Chinese property companies listed in Shanghai and Shenzhen have raised nearly 74 billion yuan through private placements since the beginning of this year. In 2015, by way of the project, 38 property companies raised a total of about 168.7 billion yuan.