China cuts interest rates of mortgage loans and down-payment ratios
China will cut the loan rates of the individual housing provident fund by 0.25 percentage points, the central bank announced Friday.
Starting May 18, the interest rate of first-home loans that mature within or at five years will be set at 2.35 percent, while the over-five-year rate will be slashed to 2.85 percent, People’s Bank of China said on its website.
For second-home purchases, the interest rate of loans that mature within or at five years will be no lower than 2.775 percent, while the over-five-year rate will be no lower than 3.325 percent, according to reports from Xinhua News Agency.
Housing is at the base of people’s livelihoods and the root of many people’s lives. At a teleconference focused on ensuring the delivery of housing projects on Friday, Chinese Vice Premier He Lifeng urged further efforts to push forward the construction of government-subsidized housing, dual-use public infrastructure that can accommodate emergency needs, and the redevelopment of urban villages.
Efforts should be made to address risks concerning unfinished commercial housing projects, ensure the delivery of housing projects and push forward the de-stocking of commercial housing, he said.
Local governments of regions where there are relatively large commercial housing stocks are allowed to buy some homes at reasonable prices and provide them as affordable housing, according to He.
The real estate market incorporates people’s immediate interests, as well as China’s overall economic and social development. Ultimately, the organization and implementation of these proactive policies can greatly elevate the confidence of first- and second-time homebuyers, in the bid to boost further property demand.
“Prices for new houses are yet to bottom out, but the recently launched policy combination with supportive measures, could provide at least some-term fixes and at best, provide a longer-term boost for destocking” Bruce Pang, chief economist of JLL Greater China, told CGTN.
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