(Yicai Global) July 28 -- Although private real estate developers have received government policy support, some are still experiencing severe difficulties raising funds, with the financing environment yet to improve significantly.

Almost no projects can obtain new development loans, and even the extension of existing ones supported by policies is difficult to acquire, a person from a real estate firm in eastern China told Yicai Global.

An insider from a developer yet to default said to Yicai Global that it is also hard to roll forward an extension of an existing development bond, perhaps because the bank remains worried about the firm's ability to repay it.

Such concern can stem from the sluggish property sales data. In the situation where financing channels are closed, real estate firms' cash flow are almost entirely rely on returns from sales.

"Sales so far in July have been extremely poor," a property insider in eastern China told Yicai Global earlier this month. "Even in Shanghai, selling projects in non-core areas is becoming more difficult."

A financing support policy for the real estate sector issued by Chinese regulators last November requires monetary institutions to reasonably extend the existing financing of developers to ease their cash flow pressure and provide them with more time to complete existing projects.

After its implementation, the policy played a role in alleviating the financial shortage of real estate builders. The principal amount of property firms' bonds approved for an extension surged 62 percent to CNY163.9 billion (USD22.9 billion) as of July 14 from a year earlier, according to a research report by TF Securities.

But several real estate companies said to Yicai Global that there is no unified standard in implementing this policy, and the practices of different localities and banks are different. It remains difficult for many projects to get development loan extensions, they pointed out.

Regarding new bond issuance, 80 major developers raised CNY296.5 billion via bonds in the first half of this year, data from China Real Estate Information showed. But more than half of the builders were state-owned, and only a few were well-known private ones, such as Country Garden, Agile Group Holdings, and New Hope Group, with the financing scale of each private firm being far smaller than that of their state-owned counterparts.

Editors: Tang Shihua, Martin Kadiev