China eases mortgage rules for second home buyers
China has decided to ease mortgage regulations for second home buyers in order to boost demand in the housing market. The minimum downpayment level for second home buyers in China will be lowered to 40 percent from 60-70 percent, according to a joint statement issued by China’s central bank, the Ministry of Housing and Urban-Rural Development, and the China Banking Regulatory Commission (CBRC).
Furthermore, minimum downpayments for second home buyers using public housing funds will be reduced to 30 percent from 60 percent, while, for first home buyers using public housing funds, minimum downpayments will be cut to 20 percent of the home’s value, decreasing from 30 percent.
The new mortgage rules are expected stimulate transaction activities in the sluggish real estate market, thereby also boosting activity in downstream industries, including the steel industry.