BEIJING, (Reuters) – China’s land sales fell for the second month in China as private developers continued to demand more. This was due to tighter lending regulations that have increased pressure on local authorities who are dependent on these auctions for income.

The value of land sold nationwide in September fell by 11.15% to 570.3 Billion Yuan ($89B), according to Reuters calculation of data from the finance ministry. In August, sales sank 17.5%.

Due to developers’ frantic bids, land sales rose by 8.4 trillion Yuan to 8.4 Trillion yuan in 2020. These record sales, which are equivalent to Australia’s annual gross domestic products, have bolstered the fiscal budgets of local governments and stabilized their economies in an era of pandemic.

Beijing introduced the “three redlines” in August 2012 to address the financial obligations that developers have to meet due to increased concern about the developer’s indebtedness, such as China Evergrande Group. Developers that fail to follow the guidelines will be denied new bank loans.

This year’s sector has been affected by tighter funding conditions. Capital-starved realty companies have halted new projects and reduced land purchases from local governments.

According to data released Friday by the Finance Ministry, revenue from land sales increased 8.7%, or 5.3634 trillion won, in the nine first months of 2021. It was a slower rate than the 12.7% growth seen in January-August.

($1 = 6.3988)