The new regulation, which took effect on Tuesday, requires property owners to pay off their entire mortgage before transferring a deed to a buyer, an official at the Shanghai Housing and Land Administration Bureau said on Thursday.

Property owners can still sell if they find a buyer willing to put down the entire balance of the mortgage as a down payment to pay off the loan.

The official at the Housing Bureau, who refused to give her name, said the policy was aimed at preventing speculative property transactions, the main engine behind the double-digit increases in average real estate prices in Shanghai in the past few years.

In another new measure, the Shanghai government is extending the waiting period between the sale and transfer of ownership for property to 28 days from the previous seven, the bureau said.

The changes reflect worries that property prices are being driven unmanageably high, risking financial problems and pricing many residents of this city of more than 20 million out of the market.

``The government is duty-bound to make resolving the housing difficulties of the common people, especially low-and middle-income families, its responsibility,'' said mayor Han Zheng.

Authorities face the dilemma of looking after the city's poor while also protecting the interests of property owners who make up an increasingly large part of the population.

The government has announced plans to build 20 million square meters of new apartments for low-income families and to set up a low-rent housing system.

To discourage the speculative dealings that have driven prices skyward, the city last month decreed a 5.55 percent capital gains tax on sales of property within a year of purchase. Among other credit-tightening measures, the interest rate charged on mortgage loans of more than five years has been raised to 6.12 percent from 5.31 percent.

The measures are too recent to have had much impact so far.

``I don't think it will have a big impact on the whole business in the long term,'' said Zong Qi, a consultant at Shanghai Transmit Property Consultants. ``But this will discourage purchases of secondhand property. I guess people will consider buying new homes in suburban areas.''

The mainland began tightening access to credit for property development more than a year ago. It has also increased interest rates, advised banks to demand bigger down payments and restricted the conversion of farmland for real estate development. Property prices in Shanghai rose nearly 16 percent in 2004. Many other cities also have seen similar increases. Prices in choice downtown areas have risen far faster.

Though most obvious in the big cities, the property boom is nationwide.

Last week, top leaders ordered local governments to make containing price rises a priority, suggesting they temporarily suspend approvals for new real estate projects in places with the biggest increases. ASSOCIATED PRESS