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New home loans rise

CHINESE banks in Shanghai extended 7.87 billion yuan (US$1.15 billion) in new individual housing loans in May, the biggest monthly jump in four years, the Shanghai headquarters of the central bank has said.

Of the total, new loans for newly built homes touched 4.57 billion yuan while 3.3 billion yuan were lent for used homes.

The banks also lent 8.69 billion yuan in new personal consumption loans over the same period, the largest monthly rise since 2000.

A total of 2.1 million square meters of new houses, excluding those designated for relocation uses, changed hands in May in Shanghai, according to data from E-house (China) Holdings Ltd. The total area jumped 10.5 percent month on month.

The rise in housing loans indicated home buyers were generally optimistic about the property market, E Yongjian, a researcher at the Bank of Communications, was cited by Shanghai Securities News as saying.

"The volume of new home sales will likely continue to grow through June as the second quarter of the year usually is the traditional peak season for property sales," said Lu Qilin, a researcher at Shanghai Uwin Real Estate Information Service Co.

The People's Bank of China said on its Website that new yuan-backed loans climbed to 664.5 billion yuan nationwide last month, an increase from 591.8 billion yuan in April.


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