China's censors have banned further stories about a Chongqing homeowner who refused to sell out to developers.

China's State Council Information Service issued an urgent notice to the domestic print press and online media on Saturday banning future coverage of the so-called "nail house."

Ping Wu, the wife of Wu Yang, shows the verdict of a local court that orders them to move from their Chongqing home to make way for development.
(EyePress/Associated Press)

The story of 51-year-old restaurateur and martial arts champion Wu Yang and his wife, who refused to sell their house to make way for a shopping development, was on its way to becoming a national media sensation.

The builders have since excavated a 10-metre pit around Yang's house, so he is holed up there without water or electricity, threatening to use his martial arts skills against anyone who tries to dislodge him.

"Nail house" is a term used by developers to refer to homeowners who will not give up title to their property — because they are like a nail that keeps poking through even though it's knocked down with a hammer.

China's State Council passed a law earlier this year formally entrenching property rights.

About 200 residents in the area around Yang's house agreed to move, but Yang turned down an offer equivalent to $525,000 for his 219-square-metre house.

He has put a banner across the home reading "No violation of legitimate private property."

Chinese media had portrayed the story as a test of the new law enshrining property rights.

"If the government does not respect people's rights in the case, it will raise suspicions about the entanglement of civil rights, property development and government interests," China Youth Daily said in a story written before the ban, urging government to support Yang's position.

Even the China Daily, the main English-language newspaper controlled by the state, featured the story prominently on page 3 of its Saturday edition.

But 24 hours after the State Council issued its ban on coverage, internet carriers throughout the country had blocked blogs on the issue and no new stories were appearing in the state press.

A new blog called "The Nailhouse" on popular carrier Sina.com had more than 150,000 hits, but its content is now inaccessible.

The censorship directive ordered no more reporting and commenting on the "nail house events" and deletion of all feature pages, and mentioned by name the internet carriers Sohu.com, QQ.com, Netease.com and Sina.com.