Source: Wind
The market's long-awaited favorable housing policy has finally come to fruition!
On August 31, the People's Bank of China and the State Financial Supervision and Administration issued“Notice on Adjusting and Optimizing Differentiated Housing Credit Policies”,“Notice on matters relating to reducing interest rates for the first housing loan in stock”. Clearly follow the principles of marketization and the rule of law, reduce the interest rate for commercial personal housing loans for the first housing unit in stock, and guide the actual down payment ratio and interest rate for personal housing loans to decline.
Here are the relevant highlights:
1.From September 25, 2023, borrowers of the first housing commercial personal housing loan in stock can apply to the lender financial institution, the financial institution issued a new loan to replace the first housing commercial personal housing loan in stock.
2. The interest rate level for newly issued loans is determined by independent negotiations between the financial institution and the borrower, but atThe margin of points added to the loan market quoted interest rate (LPR) must not be lower than the lower limit of the interest rate policy for the first housing commercial personal housing loan in the city where the original loan was issued.
3. The lower interest rate policy for the first set of residential commercial personal housing loans is implemented in accordance with current regulations.The lower interest rate policy for the two housing commercial personal housing loans was adjusted to not lower than the market quoted interest rate for loans of the corresponding term plus 20 basis points.
4. Unify the minimum down payment ratio policy for commercial personal housing loans across the country. There is no longer a distinction between cities that have implemented “purchase restrictions” and cities that do not implement “purchase restrictions,”The minimum down payment ratio policy for commercial personal housing loans for the first home and the second home is unified at no less than 20% and 30%.
5. Each region can follow the principles of city-specific policies, according to the local real estate market situation and regulatory needs,It independently determines the minimum down payment ratio and lower interest rate for the first and second housing units within the jurisdiction.
Relevant central bank officials answer reporters' questions
On August 31, the People's Bank of China and the General Administration of Financial Supervision jointly issued the “Notice on Adjusting and Optimizing Differentiated Housing Credit Policies” and the “Notice on Matters Relating to Lowering Interest Rates on First Housing Loans in Stock”. The responsible comrade answered questions from reporters regarding policy adjustments.
Q: What is the background of the adjustment and optimization of differentiated housing credit policies?
Answer: On July 24, the Politburo meeting of the Central Committee made it clear to adapt to the new situation where there have been major changes in the supply and demand relationship in China's real estate market, adjust and optimize real estate policies in due course, and make good use of the policy toolbox according to urban policies. On July 31, the executive meeting of the State Council proposed introducing policies and measures conducive to the stable and healthy development of the real estate market according to different needs, different cities, etc., to speed up research and construction of a new development model for the real estate industry.
In order to implement the decisions and arrangements of the Party Central Committee and the State Council, the People's Bank of China and the General Administration of Financial Supervision issued a notice to adjust and optimize the current differentiated housing credit policies, support all regions to make good use of the policy toolbox in line with urban policies, guide the actual down payment ratio and interest rate for personal housing loans to decline, and better meet the demand for rigid and improved housing.
Q: What is the focus of this differentiated housing credit policy adjustment and optimization?
A:The first is to unify the minimum down payment ratio policy for commercial personal housing loans across the country. There is no longer a distinction between cities with “purchase restrictions” and cities that do not implement “purchase restrictions”. The minimum down payment ratio policy for commercial personal housing loans for the first home and the second home is unified to not be less than 20% and 30%.
The second isAdjust the lower limit of the two housing interest rate policies to no less than the market quoted interest rate (LPR) for loans of the corresponding term plus 20 basis points. The lower limit of the first housing interest rate policy is still no less than the LPR for the corresponding period minus 20 basis points.
Each region can independently determine the minimum down payment ratio and lower interest rate for the first and second housing units within its jurisdiction in accordance with the principles of city-specific policies and according to the local real estate market situation and regulatory needs.
Q: Why lower the interest rate for the first home loan in stock?
Answer: The relationship between supply and demand in China's real estate market has changed significantly in recent years. Borrowers and banks are demanding that assets and liabilities be adjusted and optimized in an orderly manner.The decline in interest rates on stock housing loans can save interest expenses for borrowers and is conducive to expanding consumption and investment. For banks, it can effectively reduce the phenomenon of early loan repayment and reduce the impact on bank interest income. At the same time, it is also possible to reduce the space for illegal use of operating loans and consumer loans to replace existing housing loans, thereby reducing hidden risks. In order to better adapt to the new situation described above, the People's Bank of China and the General Administration of Financial Supervision clearly follow the principles of marketization and the rule of law, and support and encourage banks and borrowers to negotiate and adjust interest rates for the first housing loan in stock.
Q: Which stock of first home loans can I apply for a lower interest rate? How do I apply?
Answer: The first eligible housing loan in stock is a commercial personal housing loan for stock housing that has been issued by a financial institution before August 31, 2023, has signed a contract but has not been issued, and where the borrower's actual housing situation meets the first housing standards in the city where it is located.
For eligible housing loans in stock,Starting from September 25, 2023, borrowers can voluntarily apply to lender banks. Banks are also encouraged to provide more convenient services to borrowers by issuing announcements and batch processing.In terms of adjustment methods, it is possible not only to change the housing loan interest rate plus point margin agreed in the contract, but also to have the bank issue a new loan to replace the stock loan. The specific interest rate adjustment range is determined by negotiation between borrowers and lenders, but the adjusted interest rate cannot be lower than the lower limit of the first housing loan interest rate policy set in the city where the original loan was issued. Newly issued loans can only be used to repay existing loans, and are still included in commercial personal housing loan management.
The People's Bank of China and the General Administration of Financial Supervision will pay close attention to market developments, guide banks and customers to conduct independent negotiations in accordance with the principles of marketization and the rule of law, reduce interest rates on housing loans in stock in an orderly manner, and maintain a competitive order in the market.
How big is the impact?
According to a previous research report by Everbright Securities, a large amount of early repayment of personal mortgages will not directly affect housing demand, but it will have a certain impact on the operations of commercial banks, whileLowering interest rates on stock mortgages is a good way to curb the momentum of early loan repayments, thereby supporting the recovery and expansion of consumption.
Dongwu Securities wrote in a research report in early August that adjusting interest rates on existing mortgages can reduce residents' willingness to repay their loans early, but at the same time, it will also increase the pressure on commercial banks' net interest spreads. The central bank press conference on July 14 revealed that in the context of changes in price relationships such as wealth management yields and mortgage interest rates, it is remarkable that residents use deposits or reduce other investments to repay stock loans in advance.Adjusting interest rates on stock mortgages can help reduce residents' willingness to repay early, thereby improving the stability of bank operations. However, lower interest rates on stock mortgages will further reduce banks' profit margins, soIt is expected that the central bank may support some banks with greater influence through structural policy tools. Under the policy tone of “increasing countercyclical adjustment,” the downgrading operation is also expected to be implemented within the year.
Minsheng Securities believes that the steady progress of interest rate cuts on stock mortgages still requires further guidance from the central bank. The key may be to provide monetary support or incentives for commercial banks.Possible incremental policies include establishing relevant structural monetary policy instruments, lowering deposit interest rates, and targeted downgrades.
A number of major banks have stated their positions
On the evening of August 31, the Agricultural Bank, China Construction Bank, ICBC, CMB, and the Postbank quickly announced that they would carry out preparations to adjust interest rates for the first set of personal housing loans in stock in an orderly manner in accordance with the law.
Agricultural BankThe announcement stated that in order to implement the decisions and arrangements of the Party Central Committee and the State Council and effectively play the role of financial institutions in serving the real economy, safeguarding and improving people's livelihood, the Bank, under the guidance of relevant departments, is actively carrying out preparations to adjust interest rates for the first set of personal housing loans in stock in an orderly manner in accordance with the law.
China Construction BankThe announcement stated that in order to implement the decisions and arrangements of the Party Central Committee and the State Council, adhere to the position that houses are for living and not for speculation, and reflect the responsibility of major state-owned banks, the Bank of China will actively implement the requirements of the “Notice of the People's Bank of China and the State Administration of Financial Supervision and Administration on Matters Relating to Lowering Interest Rates on First Housing Loans in Stock” and promote efforts to reduce interest rates on commercial personal housing loans for the first housing stock in an orderly manner in accordance with the law. In accordance with the principles of marketization and the rule of law, the Bank will provide efficient and convenient online and offline services, do a good job of reducing interest rates on commercial personal housing loans for the first housing stock in accordance with the provisions of the notice, and effectively play the role of finance in supporting the recovery and expansion of consumption, safeguarding and improving people's livelihood.
Industrial and Commercial BankAn announcement was issued on adjusting interest rates for the first housing loan stock. In order to implement the decisions and arrangements of the Party Central Committee and the State Council, and effectively play the role of finance in the fields of serving the real economy, supporting the recovery and expansion of consumption, safeguarding and improving people's livelihood, the Bank of China earnestly implemented the requirements of the “Notice of the People's Bank of China, the State Administration of Financial Supervision and Administration on Matters Relating to Lowering Interest Rates on First Housing Loans in Stock”, and is actively promoting interest rate adjustments for individual housing loans in stock in an orderly manner in accordance with the law. In accordance with the principles of marketization and the rule of law, the Bank will provide convenient services through multiple online and offline channels, and carry out interest rate adjustments in accordance with the law.
Editor/Jeffrey