A joint statement from the People's Bank of China and National Administration of Financial Regulation on Thursday China time that homebuyers' minimum down payment will be reduced and banks will be allowed to lower rates on existing mortgages.
- first-time homebuyers' minimum down payment will be 20%
- second-time buyers at least 30%
- mortgage interest rate for first-time buyers should be no less than the level of 20 bps over the loan prime rate (LPR)
- lowest mortgage interest rate limit for second-time homebuyers should be no less than 20 basis points (bps) over the LPR
Chinese media with the report, saying:
- The optimization aims to fit the major changes in supply and demand in China's housing market, while better meeting inelastic housing demand and promoting the stable, healthy development of the real estate market, read the notice.
- It stressed that the country is sticking to the position that houses are for living in, not for speculation.
Currently, most major cities have about a 30% downpayment ratio for first homes, and 40% or more for second homes.
