xinhua fresh news | benefiting 50 million households, the interest rate of existing mortgage loans has been lowered!
2024-09-25
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the interest rate of existing mortgage loans has been reduced! it will benefit 50 million households with existing mortgage loans.
on september 24, pan gongsheng, governor of the people's bank of china, stated at a press conference held by the state information office that the interest rates on existing mortgage loans will be lowered, and the minimum down payment ratio for mortgage loans will be unified to guide commercial banks to lower the interest rates on existing mortgage loans to near the interest rates on newly issued mortgages.
on the same day, pan gongsheng introduced at the press conference that the people's bank of china plans to guide banks to adjust the interest rates of existing mortgage loans in batches, with an average reduction of about 0.5 percentage points. it is expected that the policy will benefit 50 million households and 150 million people, and reduce the total interest expenditure of households by about 150 billion yuan per year on average.
many borrowers are familiar with the reduction of existing mortgage interest rates. in august last year, the people's bank of china pushed commercial banks to orderly reduce existing mortgage interest rates. after the adjustment, the average interest rate of existing first-home mortgages dropped by 0.73 percentage points.
however, as my country's interest rate level continues to decline, the interest rate gap between new and existing mortgage loans continues to widen, attracting widespread attention.
since the beginning of this year, the people's bank of china has adjusted the loan market benchmark rate (lpr) for more than five years twice, with a cumulative decrease of 35 basis points. data shows that in august, the interest rate for newly issued personal housing loans was 3.35%, 78 basis points lower than the same period last year, at a historical low. the interest rate for newly issued first-home mortgages in many cities has dropped to around 3.2%, and in some areas it has even dropped to the "2-digit" level.
at the same time, after the interest rate of existing first-home mortgage loans was lowered last year, the current interest rate of existing mortgage loans is still generally around 4%. especially in cities such as beijing, shanghai, shenzhen, and guangzhou, the original markup was relatively high, and the interest rate spread between newly issued mortgage loans and original existing mortgage loans was even greater.
as the interest rates on new mortgage loans are getting lower and lower, the psychological gap among many existing mortgage borrowers has widened, and some have even joined the ranks of "early mortgage repayment".
this is also confirmed in cicc's research and calculations: the current bank mortgage early repayment rate is still at a high level of around 14%, and there may be room for using consumer loans and business loans to replace mortgages.
pan gongsheng made it clear at the press conference that further reducing borrowers' mortgage interest expenses will help promote the expansion of consumption and investment, and will also help reduce early loan repayments. at the same time, it can also reduce the space for illegal replacement of existing mortgages, protect the legitimate rights and interests of financial consumers, and maintain the stable and healthy development of the real estate market.
in addition to lowering the interest rates on existing mortgage loans, the people's bank of china and the state administration of financial supervision have also made it clear that commercial personal housing loans at the national level will no longer distinguish between first and second homes, and the minimum down payment ratio will be unified to 15%.
previously, in the new mortgage policy launched in may, the minimum down payment ratios for first and second mortgages were reduced to no less than 15% and 25% respectively. with the minimum down payment ratio unified to 15%, the down payment ratio for second mortgages has also hit a new low in recent years.
dong ximiao, chief researcher at china unionpay, said that the adjustment of housing finance policy this time was quite large and exceeded expectations, sending a clear signal of stabilizing the real estate market, helping to stabilize housing consumption confidence and enhance residents' willingness and ability to consume housing.
however, pan gongsheng also stressed that local governments can independently decide whether to adopt differentiated arrangements and determine the minimum down payment ratio in their jurisdictions based on their city's policies. at the same time, commercial banks will negotiate with customers to determine the specific down payment ratio level based on their risk profile and willingness.
when will the favorable mortgage policy be implemented?
reporters learned from the press conference that because there are many borrowers involved, banks also need a certain amount of time to make necessary technical preparations, such as revising contract texts, transforming and adjusting systems, etc.
it is worth noting that pan gongsheng clearly stated that "commercial banks will be guided to improve the pricing mechanism of mortgage loans". the reporter learned from the people's bank of china that this means that banks may adjust the interest rates of existing mortgage loans in batches for the last time. as banks continue to improve the pricing mechanism of mortgage loans, the interest rates of existing mortgage loans will be adjusted dynamically through independent negotiation between banks and customers based on market principles.
in recent years, the people's bank of china has continuously improved its macro-prudential policy on real estate finance, adopted comprehensive measures from both the supply and demand sides, and repeatedly lowered the minimum down payment ratio for personal housing loans, reduced loan interest rates, abolished the lower limit of interest rate policies, and established a series of policies such as affordable housing re-lending to support the acquisition of existing commercial housing.
this time, while supporting residents' demand for home purchases, the financial management department also introduced a number of policy measures that are beneficial to real estate companies.
for example, the phased policies such as the extension of existing financing of real estate companies and commercial property loans will be extended to the end of 2026; for example, the proportion of the people's bank of china's investment in the affordable housing refinancing policy will be increased to 100%; for example, it is studied to allow policy banks and commercial banks to lend to support qualified enterprises to acquire land from real estate companies in a market-oriented manner...
in the near future, a series of new real estate finance initiatives will be implemented one after another, which will not only respond to current market expectations, but also better support the risk resolution and stable and healthy development of the real estate market from a financial perspective, and will create a good financial environment for stable economic growth and high-quality development.
planning: chen fang
reporter: wu yu
produced by xinhua news agency domestic department
source: xinhua news agency client
