Hong Kong shares have closed 0.32 per cent lower, wiping out early gains, despite a strong lead from Wall Street.
The benchmark Hang Seng Index lost 71.36 points on Tuesday to end at 22,317.20 on turnover of $HK65.44 billion ($A9.37 billion).
Cathay Pacific Airways fell 0.39 per cent to $HK15.20, energy giant CNOOC added 1.63 per cent to $HK12.46 and HSBC tumbled 2.68 per cent to $HK81.65.
Internet firm Tencent was 0.43 per cent lower at $HK575.50, and Macau casino operator Galaxy Entertainment was 2.97 per cent higher at $HK74.50.
Chinese shares closed down 2.05 per cent on fears over liquidity and the country's property sector.
The benchmark Shanghai Composite Index dropped 42.47 points to 2,034.22 on turnover of 127.8 billion yuan ($A23.20 billion).
The Shenzhen Composite Index, which tracks stocks on the mainland's second exchange, plunged 3.96 per cent, or 44.97 points, to 1,089.22 on turnover of 203.1 billion yuan.
Chinese media reported last week that some domestic banks are cutting off lending to property developers, sparking worries of a credit shortage in the real estate sector.
Official data released on Monday also showed fewer cities - 62 out of 70 tracked - recorded month-on-month increases in new home prices in January, down from 65 in December.
"The market is cautious, as a slowdown in the housing market leads investors to be concerned about the health of the general economy," Zheshang Securities analyst Zhang Yanbing told AFP.
Adding to the selling pressure were worries about financial market liquidity after the country's central bank effectively drew cash out of the system as it continues to fret over possible bad debts among lenders.
Lander Real Estate slid 6.42 per cent to 4.23 yuan and China Enterprises gave up 6.17 per cent to 6.24 yuan.
Securities firms fell on lingering concerns over lower brokerage fees. Sinolink Securities tumbled 9.99 per cent to 21.90 yuan, while Sealand Securities fell 5.32 per cent to 9.97 yuan.
Internet firms also dropped on worries they were overvalued. Wangsu Science & Technology sank by its 10 per cent daily limit to 119.24 yuan and Hangzhou Shunwang Technology also plunged 10 per cent to 55.08 yuan.
