Demand for property in China is reportedly booming, following the country’s decision to revoke the ban on overseas nationals buying property on the country’s mainland.

According to consultancy firm, Landpower, Hong Kong nationals bought between 11,000 and 12,000 residential units in the mainland in the first half of 2009, up +23% from the same period last year. Increasing residential prices in China has led to calls for banks to curb mortgage lending.

The price of new residential property in 36 Chinese cities in China rose by +6.3% in the last year, according to data compiled by the National Development and Reform Commission.

With genuine fears that a property bubble may be forming, the Chinese Government may soon step in and introduce fresh regulations to help prevent residential prices booming on the back of greater speculative activity in the residential sector.