BEIJING, May 13 (Xinhua) — A chief of China’s central bank has urged the country’s commercial banks to be quicker in approving and issuing loans to “eligible” home buyers, mainly first-time home buyers.

The statement was made by Liu Shiyu, vice governor of the People’s Bank of China (PBOC), when speaking to heads of 15 commercial banks in a meeting about housing financial services on Monday, according to a statement posted on the PBOC’s website on Tuesday.

Liu urged the banks to “properly allocate credit resources and prioritize credit demand of first-time home buyers.”

The new policy moves came amid falling home sales and cooling home prices nationwide. Official data showed sales of residential property dipped 7.7 percent during the first quarter of 2014 to 1.1 trillion yuan (about 176.6 billion U.S. dollars).

Home prices in a pool of 70 major Chinese cities grew at a slower pace in March, with fewer cities reporting month-on-month price gains. Month on month, four cities saw new home prices decline.

Data for home prices for April is expected on Sunday, and most analysts expect the cooling trend to continue.

Liu asked the banks to “set the interest rates of loans for first-time home buyers at a reasonable level after taking financial sustainability and risk management into account.”

To curb speculative buying, the government resorted to tightening measures such as higher down payments or a 20-percent capital gains tax. Banks have raised mortgage rates for home buyers due to tighter liquidity.

A survey by CRIC, a unit of real estate services firm E-House China, showed that nearly 90 percent of 69 bank branches in 22 Chinese cities have stopped offering preferential mortgage rates to first-home buyers, with some increasing the rates 5 to 10 percent above the benchmark rate.

Among the 35 major cities surveyed by Centaline Property Agency Ltd. in April, 25 have seen their banks suspend housing loans.

The weak demand has forced both government and developers into action. The city of Nanning in southwest China’s Guangxi Zhuang Autonomous Region relaxed its policy on home purchasing in late April.

More second-tier cities are expected to loosen their grips over property curbs if demand remains subdued.

However, a fully fledged loosening of policy is out of the question, and potential home buyers with one or more homes still have to pay higher mortgage rates or even are not allowed to buy property on mortgages.

Liu urged the banks to be “on guard against credit risks, strictly implement regulations governing the approval and issuing of home loans, and strengthen monitoring and analysis of home loan risks.”