Property sector lending by Chinese financial institutions surged in the third quarter, especially for the development of land, despite the economy losing steam for seven consecutive quarters.

The headquarters of the People's Bank of China in Beijing. Data released by the PBOC showed more loans were extended to the real estate sector from July to September than during the second quarter of the year. [Photo: China Daily]

Data released by the People's Bank of China on Monday showed 416.8 billion yuan ($66.65 billion) was lent out to the real estate sector from July to September, a rise of 29 percent on the second quarter.

Total outstanding loans to the sector reached 11.74 trillion yuan by the end of September, up 12.2 percent year-on-year, and 1.9 percentage points higher than at the end of June.

The central bank said property loans took up 15.4 percent of total new loans extended from January to September, up from 12.3 percent in the first half of this year.

"The acceleration of such loans was mainly driven by a surge in loans for land development, obviously an effect of China fast-tracking investment plans to stabilize the economy," said Guo Tianyong, banking research director at the Central University of Finance and Economics.

Land development lending rose by 7.3 percent year-on-year to 846.1 billion yuan, 6.5 percentage points higher than the end of June.