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Home loans fall on tighter measures
By Zhang Fengming |
October 15, 2010, Friday
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Print Edition
Print Edition
OUTSTANDING mortgages in Shanghai in September dropped for a second straight month as tighter government controls on housing loans begin to bite, the local banking regulator said yesterday.
Total mortgage lending outstanding fell by 427 million yuan (US$63.3 million) last month to 427 billion yuan at the end of September. That followed a 240-million-yuan slide in August, according to the Shanghai Bureau of the China Banking Regulatory Commission.
For the 12 months ended September 30, mortgages were down 17.7 billion yuan from a year earlier.
"We will expand our monitoring of how banks are implementing the government's tighter housing policy," said Yan Qingmin, head of the Shanghai banking regulatory body yesterday.
The mortgage lending market in Shanghai began losing steam in April after the central government raised down-payment requirements and advised banks to stop issuing mortgages for third homes as part of a campaign to rein in real estate speculation and thwart the risk of a property market collapse.
Although home lending dropped, prices did not. Frustrated authorities rolled out a series of tighter controls. This month regulators said people will now be allowed to buy only one home beyond any they already own. They may seek bank loans for first or second homes, but mortgages for third or more homes will not be allowed.
Banking authorities are not only talking tough on loan volumes but also loan quality.
The outstanding value of non-performing debt in mortgage and property-development lending tumbled 1.97 billion yuan to 3.39 billion yuan at the end of September. The bad-loan ratio, meanwhile, dropped 0.33 percentage point to 0.39 percent.
Housing non-performing loans alone shrank by 175 million yuan to 1.49 billion yuan at the end of September. The bad loan ratio in the segment inched down 0.08 percentage point to 0.32 percent.
But the outstanding value of loans for affordable housing development rose to 6.02 billion yuan by the end of September, up 80 percent from than a year ago. That compares with a growth rate of about 20 percent for all property development loans.
The State Council raised the down-payment minimum on second-home loans to 50 percent from 40 percent in April and added 10 percent to the interest rate on second mortgages.
Total mortgage lending outstanding fell by 427 million yuan (US$63.3 million) last month to 427 billion yuan at the end of September. That followed a 240-million-yuan slide in August, according to the Shanghai Bureau of the China Banking Regulatory Commission.
For the 12 months ended September 30, mortgages were down 17.7 billion yuan from a year earlier.
"We will expand our monitoring of how banks are implementing the government's tighter housing policy," said Yan Qingmin, head of the Shanghai banking regulatory body yesterday.
The mortgage lending market in Shanghai began losing steam in April after the central government raised down-payment requirements and advised banks to stop issuing mortgages for third homes as part of a campaign to rein in real estate speculation and thwart the risk of a property market collapse.
Although home lending dropped, prices did not. Frustrated authorities rolled out a series of tighter controls. This month regulators said people will now be allowed to buy only one home beyond any they already own. They may seek bank loans for first or second homes, but mortgages for third or more homes will not be allowed.
Banking authorities are not only talking tough on loan volumes but also loan quality.
The outstanding value of non-performing debt in mortgage and property-development lending tumbled 1.97 billion yuan to 3.39 billion yuan at the end of September. The bad-loan ratio, meanwhile, dropped 0.33 percentage point to 0.39 percent.
Housing non-performing loans alone shrank by 175 million yuan to 1.49 billion yuan at the end of September. The bad loan ratio in the segment inched down 0.08 percentage point to 0.32 percent.
But the outstanding value of loans for affordable housing development rose to 6.02 billion yuan by the end of September, up 80 percent from than a year ago. That compares with a growth rate of about 20 percent for all property development loans.
The State Council raised the down-payment minimum on second-home loans to 50 percent from 40 percent in April and added 10 percent to the interest rate on second mortgages.
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