China reveals comprehensive set of policies to stabilize property market
Date
9/30/2024 7:41:22 AM
(MENAFN) On Sunday, the People's bank of China and the National Financial Regulatory Administration introduced a comprehensive set of policies aimed at stabilizing the real estate market, which has been facing significant challenges. One of the key measures includes a mandate for mortgage rates on first and second homes to be reduced by at least 30 basis points below the loan prime rate (LPR) by October 31, 2024. This initiative is designed to alleviate the financial burdens faced by property owners, signaling the government’s commitment to supporting homebuyers during this turbulent period.
In addition to the mortgage rate adjustments, national commercial banks are required to outline their plans for implementing these changes by October 12. The new policies also stipulate a decrease in the minimum down payment ratio for commercial housing mortgages, bringing it down to no less than 15 percent for both first and second home purchases. This move aims to make homeownership more accessible and reduce the financial strain on potential buyers looking to enter the housing market.
Another significant adjustment involves refining the pricing mechanism for individual commercial housing mortgage interest rates. The new approach will allow for dynamic adjustments based on agreements between borrowers and banks, fostering a more flexible lending environment that can better respond to market conditions. Furthermore, the central bank plans to enhance funding for financial institutions that issue loans to assist local state-owned enterprises in purchasing completed yet unsold commercial properties at reasonable prices, which will subsequently be used as affordable housing.
These stimulus measures come in the wake of a recent meeting of the Political Bureau of the Communist Party of China Central Committee, which emphasized the need to reverse the downturn in the real estate market and stabilize its performance. By implementing these policies, the Chinese government aims to instill confidence in the housing sector and promote a more sustainable recovery, addressing the challenges that have impacted both buyers and the overall economy.
MENAFN30092024000045015839ID1108729111
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.