China is pushing to scrap rules that disqualify some people who have previously taken out mortgages from benefiting from the lower rates enjoyed by first-time buyers.
(Bloomberg) — China is pushing to scrap rules that disqualify some people who have previously taken out mortgages from benefiting from the lower rates enjoyed by first-time buyers.
In a recent meeting with property developers and builders, Ni Hong, Minister of Housing and Urban-Rural Development, called for homebuyers who had paid off previous mortgages to be considered as first-time purchasers, China’s official Xinhua News Agency reported Thursday.
The move is the latest effort by authorities to support the nation’s property market, a key component of the world’s second-largest economy.
The minister also called for further measures, such as relaxing down-payment rules and reducing mortgage rates for first-home purchasers, Xinhua said.
Currently, homebuyers with a mortgage record who don’t own a property are still subject to the higher down-payment rules, and more restrictive borrowing limits are applied to those purchasing a second home.
The government “strongly” supports home purchases to meet essential dwelling demand and needs for better housing, the minister said at the meeting. He also called for tax and fee relief for housing upgrades and replacement.
Bloomberg News reported last week that Chinese authorities were considering easing homebuying restrictions in the nation’s biggest cities — potentially removing a hurdle that has curbed demand in Beijing and Shanghai for years.
While China has reduced benchmark rates and pushed the average mortgage cost to a record low, most Chinese households haven’t seen the benefit, as banks won’t reprice existing loans until the beginning of next year.
–With assistance from Fran Wang, Jing Zhao, Foster Wong, Lin Cheng, Evelyn Yu, Zheng Li and Lisa Du.
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