China's non-bank lending for the real estate industry has been growing rapidly in the past five years. It stood at approximately $3 trillion by the end of 2013, up 14 times compared to 2008, according to a report by CBRE, a global commercial real estate service company.

Following the Chinese government's legislations in 2010 to cool down the property market, banks have become selective in issuing mortgages and loans. This has caused a general slowdown in bank lending in the real estate sector.

While most listed property groups can continue to secure funding from banks, the slowdown has hit small and medium-sized developers particularly hard.

According to CBRE Research, the annual growth of bank lending for real estate in China declined to 13 percent during 2011 and 2014 from 18 percent during 2005 and 2008. Smaller real estate groups depend on pre-sales revenue as their major source of funding. They are now facing big funding issues as pre-sales diminish significantly.

As a result, small and medium-sized developers are shifting to alternative funding sources in public and private debt markets. Crowdfunding, in which developers utilize the Internet to attract investors for their projects, is emerging as a new trend.

"China's real estate industry is going through a period of consolidations," Frank Chen, executive director and head of CBRE Research, CBRE China, said. "Going forward, more and more developers are expected to move to online lending via crowd sourcing. However, for the near future, Internet-based finance will not replace traditional funding as a mainstream channel."