① The central bank announced the cancellation of the lower interest rate policy for commercial personal housing loans for the first home and two housing units at the national level, and the favorable policy was extended to two apartments. ② It is expected that more cities will lower mortgage interest rates, and it is also expected that there will be room for lower mortgage interest rates in first-tier and core second-tier cities.
Financial Services Association, May 23 (Reporter Gao Ping) Fuzhou announced that on the basis of abolishing the lower interest rate limit for the first home loan, after canceling the lower interest rate limit for the second home loan, local banks quickly implemented it. Today, the Financial Services Association reporter learned from the individual loan departments of several banks in Fuzhou that interest rates for first and second home loans have been lowered. Among them, interest rates for first home loans have been reduced from 3.4% to 3.3%; interest rates for second home loans (when one loan is unsettled) have been reduced to 3.75%. In addition, the mortgage down payment policy has also been implemented with a 15% down payment ratio for the first set and 25% for the second set.
“Just adjusted.” A person in the personal loan department of a branch of a major bank in Fuzhou told the Finance Association reporter today that interest rates on the first home loan have now been reduced from 3.4% to 3.3%. “If one loan has not been paid off, buying another one will count the interest rate for two sets. Currently, the interest rate has been reduced to 3.75%. The interest rate for the first home loan has been settled, and the purchase of another home will be executed according to the interest rate on the first home loan.” That's what the person said.
The loan department staff of another major bank in Fuzhou also said that interest rates for the first and second home loans have been adjusted. Among them, the interest rate for the first home loan was reduced to 3.3%, and the second home loan rate was reduced from the previous LPR+30BP to LPR-20BP, that is, from 4.25% to 3.75%. A member of the loan department of a branch of another bank also confirmed to the Finance Association reporter that the interest rate on the first home loan was lowered to 3.3%. However, she said that the interest rate for refinancing a loan while one loan has not been settled is pending. The interest rate for the first two home loans under this policy was 4.25%.
According to a real estate agent in Fuzhou, “as long as the loan is repaid, the interest rate for the first home will be executed, but if one loan under the name has not been paid off, the reloan will be applied as a two-home loan.”
The reduction in mortgage interest rates by many local banks in Fuzhou is not unrelated to the latest relevant policies issued by Fuzhou. On May 22, the Fujian branch of the People's Bank of China issued a notice to adjust Fuzhou's housing credit policy. Among them, in terms of mortgage interest rates, the lower interest rate limit for commercial personal housing loans for the second housing unit in Fuzhou will be abolished on the basis that the lower interest rate limit for commercial personal housing loans for the first housing unit was abolished on April 3, 2024. Within the scope of this policy, commercial banks can reasonably determine the specific interest rate level for each loan based on factors such as the institution's business conditions and customer risk.
Also, in terms of down payment, the down payment ratio for commercial personal housing loans for the first housing unit in Fuzhou was adjusted to not less than 15%, and the down payment ratio for commercial personal housing loans for the second housing unit was adjusted to not less than 25%. Within the scope of this policy, commercial banks can determine specific down payment ratios for the first and second commercial personal housing loans for newly issued housing units in accordance with the principles of marketization and legalization of the rule of law. The above policy will be implemented from May 22, 2024.
It should be pointed out that in the context of the new policy, interest rates for two-home loans in Fuzhou have been lowered significantly. A Financial Services Association reporter discovered that during the implementation of this round of new mortgage policies, interest rates on two-home loans in some cities have also dropped significantly. In addition to Fuzhou, among the cities that have recently lowered mortgage interest rates, the first home loan interest rate in Wuhan was reduced by 30 BP, from 3.55% to 3.25%; the second-home home was reduced by 80 BP, from 4.15% to 3.35%, the highest drop in history. If you calculate a loan of 2 million with equal principal and interest (30 years) for two homes, the interest will be reduced by nearly 330,000 yuan, or nearly 1,000 yuan less per month.
On May 17, when the central bank announced the cancellation of the lower interest rate policy for commercial personal housing loans for the first housing unit and two housing units at the national level, many experts said that the favorable policy was extended to two apartments. Chen Wenjing, director of market research at the China Index Research Institute, predicts that more cities will lower mortgage interest rates, and that room for lower mortgage interest rates in first-tier and core second-tier cities is also expected to open up.