China's Ministry of Finance (MOF), the People's Bank of China (PBoC) and the National Financial Regulatory Administration (NFRA) have jointly issued a notice announcing that, starting from October 1, China will provide interest subsidies for residents who purchase homes using newly issued commercial personal housing loans. The policy targets first-time buyers with essential housing needs, capping the purchased property at a floor area of 120 square meters and a price of RMB 1.5 million ($0.22 million). The loan amount eligible for the subsidy is capped at RMB 1.0 million ($0.15 million), with the fiscal authority offering an annualized subsidy of 1.0 percentage point for a maximum of five years.
The policy is primarily designed to use fiscal funds as a catalyst to provide targeted support for first-time buyers with essential housing needs, further unlocking purchasing potential on the demand side, which will likely boost the demand for long steel used in construction activities.
