Authorities have tightened credit controls on the purchase of
second properties, raising the down payment to 40 percent from 30
percent to drive out speculative purchasing.
Mortgage applicants who have already bought property on mortgage
and seek another loan for second and other real estate must now pay
at least 40 percent with an interest rate at least 10 percent above
the benchmark rate, the People's Bank of China and the China
Banking Regulatory Commission said. They issued a joint statement
early this morning.
For those seeking mortgages to purchase third, fourth and other
properties, the down payment requirements and interest rates will
be higher, with commercial banks determining their specific
requirements, the top banking authorities said.
In July Citibank launched its home refinancing program in
Shanghai to target home buyers who need refinancing because of
rising property prices in the city. It is the first offering of its
kind by an overseas bank in China.
New individual mortgages in Shanghai posted a monthly record in
August, the highest since 2005, and the central bank cautioned
commercial banks about risks.
In August, individual mortgages increased by 7.13 billion yuan
(US$946 million) at domestic banks in Shanghai, up 1.26 billion
yuan over July in the booming property market, the Shanghai
headquarters of the central bank said earlier this month.
(Shanghai Daily September 28, 2007)
