On October 10, Industrial and Commercial Bank made new progress on adjusting existing housing loan interest rates. ICBC released the second FAQ on adjusting existing housing loan rates, further disclosing its specific adjustment plan, and confirmed the unified batch adjustment of existing housing loan interest rates on October 25.

At the same time, according to inquiries by multiple financial journalists, except for Industrial and Commercial Bank, other banks have not made any new progress on adjusting existing housing loan interest rates. They generally indicate that the operational details will still be released on October 12, and the batch adjustment work will be completed by October 31.

Industrial and Commercial Bank to batch adjust existing housing loan interest rates on October 25.

"First-time home buyers, second or subsequent home buyers who meet the conditions can undergo batch adjustments." The Industrial and Commercial Bank announcement states that for most regions except Beijing, Shanghai, Shenzhen, etc., existing home loans can be adjusted to not less than LPR-30BP. Most higher interest rate existing commercial personal home loans fall within the adjustment scope.

For those whose home loans are priced at a floating rate and the current rate is higher than LPR-30BP, their home loan rate will be adjusted to LPR-30BP; For loans currently priced at fixed/base rate, they need to actively apply for conversion to a floating rate first, and then proceed with the adjustment of existing rates.

For second home loans in Beijing, Shanghai, Shenzhen, etc., they will be adjusted to the lower limit of the current new loan rate policy.

It is understood that the second home loan rates in Beijing within the Fifth Ring Road will be decreased to LPR-5BP, and outside the Fifth Ring Road to LPR-25BP; The second home loan rates limit in Shanghai Free Trade Zone, Lingang New Area, Jiading, Qingpu, Songjiang, Fengxian, Baoshan, Jinshan districts is LPR-25BP, while in other areas it is LPR-5BP; All of Shenzhen is LPR-5BP.

From the announcement, industrial and commercial banks will implement a batch interest rate adjustment on October 25th, and borrowers can enjoy the interest rate cut without visiting the bank. At the same time, the industrial and commercial bank App also shows that on October 25, 2024, the bank's existing housing loan interest rates meeting the corresponding conditions will be uniformly adjusted in batches to no less than the loan market quote rate (LPR) minus 30 basis points.

"The core points of the ICBC's release of the FAQ on the reduction of existing house loan rates is that, except for certain specific cities, all mortgage rates can be reduced to the level of 3.55%. In other words, regardless of whether the mortgage rate itself is 4.0% or 3.8% this year, it will be automatically reduced to 3.55% in November through the bank system," explained Yan Yuejin, Deputy Director of the Shanghai E-House Real Estate Research Institute.

In his view, this policy adjustment of existing housing loan rates has initiated the second reduction of existing housing loans since last year. Although the situation varies in different places, the relief effect varies from person to person, but overall, all homebuyers can enjoy good relief effects.

Detailed operation rules for the adjustment of bank's existing housing loan rates will generally be released the day after tomorrow.

In fact, on September 29th, the People's Bank of China issued the "Initiative on Batch Adjustment of Existing Housing Loan Rates" on market interest rate pricing self-discipline mechanism, which pointed out that commercial banks should, in principle, uniformly implement batch adjustments of existing housing loan rates (including first-time, second-time, and above) before October 31, 2024.

"For existing housing loans with an LPR basis point spread higher than -30BP, the basis point spread will be adjusted to no less than -30BP, and not less than the minimum interest rate basis point spread for newly issued commercial personal housing loans currently implemented in the city."

That night, Industrial and Commercial Bank, Agricultural Bank, Bank of China, Construction Bank, Bank of Communications, and Postal Savings Bank of China and other six major banks successively issued announcements stating, "They are actively formulating the implementation plan for the adjustment of existing housing loan rates, plan to publish the detailed operation rules announcement on October 12th, and complete the batch adjustment of existing housing loan rates before October 31." Subsequently, major joint-stock banks and small and medium-sized banks also successively responded.

At the same time, Industrial and Commercial Bank, Bank of Communications, China Merchants Bank, Shanghai Pudong Development Bank, China Zheshang Bank, and Industrial Bank and other banks have successively released FAQs on the adjustment of existing housing loan rates, stating that they will complete the interest rate adjustment before October 31, unifying the current higher mortgage rates to LPR-30BP.

Regarding the latest progress on the adjustment of existing home loan interest rates, on October 10th, Caixin reporters consulted several banks for further information. From the feedback received, as of now, apart from Industrial and Commercial Bank of China confirming a unified batch adjustment of existing home loan interest rates on October 25th, other banks have not provided any new updates yet. Many banks have indicated that they will still release operational details on October 12th and complete the batch adjustment work by October 31st.

"As a representative 'pioneer' in the industry, Industrial and Commercial Bank of China plays a demonstrative role in this adjustment. Other banks should also act quickly to follow suit, publicly announce before the deadline on the 12th, to reassure this group of existing home buyers," said Wang Pengbo, Chief Analyst of Broadcom Consulting in the financial industry.

Yan Yuejin further pointed out that due to the large scale of existing home loans, the reduction of existing home loan interest rates has a broad impact. It will be more effective than lowering mortgage rates in the new housing market. The recent actions of state-owned major banks have positively boosted market sentiment. "Overall, this policy aimed at benefiting the people has a very good orientation, and it is an important measure to reduce the cost of existing home loans and boost consumer confidence," he expressed.