Property developers in China are 'hoarding' cash.

According to a new research, Chinese property developers have more than $25 billion in cash on their books, but they are hesitant to spend it until market worries are resolved. adhunter

According to Reuters, which analyzed data from 76 Chinese real estate management and development businesses, including prominent heavyweights such as Shimao Property Holdings and Greentown China Holdings, China's real estate management and development companies raised more than $16 billion via offshore bonds and loans in the first eight months of 2013, up 36 percent over the same period in 2012.

According to the wire agency, developers are concerned due to rising interest rates and the possibility of new government actions dampening the real estate market.

"Our financial status is fairly good," Fung Ching Simon, Greentown China Holdings' chief financial officer, told Reuters. "However, we do have concerns about a credit constraint in the business." "We've already fixed our challenges and are in a pretty stable position," says the CEO, "but other companies' troubles will have an indirect impact on us because everything is interlinked."

"While our financial status is sound, we are concerned about a credit crunch in the business."

According to Reuters, Evergrande and Greentown, two of China's largest developers, reported a more than 50 percent growth in cash and cash equivalents in the first half of the year, buoyed by strong international sales.

Mr. Fung explained, "We broadened our finance routes to global markets so that we won't be as harmed by home conditions as we were before."

According to a Reuters analysis, China's real estate companies' overall expenditures are predicted to drop 11% in the coming year, compared to a 6.6 percent gain in the larger Asia-Pacific area.

Tse Wai Wah, Evergrande's chief financial officer, told Reuters that tightening financing conditions could affect land acquisitions by property businesses.

Mr. Wah stated, "Liquidity has been tight since June." "Banks will continue to do business and will lend, but only under limited circumstances. Small-scale developers would feel the brunt of the financing crunch."

A new round of buyouts could be triggered by the richness of capital. According to Thomson Reuters data, $14.9 billion in mergers and acquisitions were announced this year, already surpassing the $14.7 billion disclosed in 2012.

"We could see smaller local players being tempted to sell out to larger national guys or Hong Kong players," Guy Stear, a Hong Kong-based analyst, told Reuters. "Similar to the banking sector, we should expect additional consolidation in the Chinese property market. It's far too disjointed."

According to Thomson Reuters StarMine SmartEstimate data, the sector's EBITDA margins, a measure of profitability, were at their lowest in six quarters as of June, and are only predicted to grow slightly for the year, to 21.5 percent this year from 20.7 percent last year.

"As a result of capital market, sector, and local credit policy uncertainty, developers are aiming to be more flexible and liquid," said Raghav Bhandari, an analyst at CreditSights, an independent research firm. "Banks will continue to be accommodating to the big players, but at least developers understand the value of buffers."

Developers have shied away from capital expenditures as property demand in Beijing and other major cities is threatened, and the government seeks to impose market-cooling measures.

Despite the steps, housing prices in China have continued to grow, prompting concern that new limitations on home purchases may be imposed.

Concerns have been voiced about the possibility of the US Federal Reserve slowing asset purchases, which could cause global interest rates to rise. However, after the Federal Reserve declared this week that it will not curtail bond purchases, interest rates in the United States remained unchanged.