Chinese property developers are caught between a rock and a hard place. Access to capital is drying up rapidly. Domestic banks, under government orders, are refusing to lend, while global debt markets have balked at several bond issues. Meanwhile, a slew of government restrictions, designed to cool the over-heating real estate market, makes it harder to make money at the other end. Developers are showing tell-tale signs of stress, including spiralling credit default swap prices and – cynics might add – infusions of cash from foreign funds.

Chinese developers are a relatively new breed, so their record is limited. Private land ownership was only introduced in 1988 and it was another decade before citizens could buy homes. But for much of this decade, they were making hay. Real estate prices have risen rapidly over the past four years. That encouraged developers to gear up and accumulate more land but it also spooked Beijing into taking aggressive steps to cool the market. These measures include increased downpayments, tax rises and land supply restrictions. Most worryingly for developers facing a cash squeeze, local authorities can confiscate land that lies idle (without construction) for two years.