BEIJING Feb 28 Chinese banks have raised
mortgage rates for first-time home buyers due to tighter
liquidity, a private survey showed on Friday, adding pressure on
a property market that has shown initial signs of cooling down.
Nearly 90 percent of 69 bank branches in 22 Chinese cities
have stopped offering preferential mortgage rates to first-home
buyers, with some increasing the rates 5 to 10 percent above the
benchmark rate, according to a survey by CRIC, a unit of real
estate services firm E-House China.
Less than 3 percent of the respondents still offer
preferential mortgage rates, the survey showed.
That compared with 21 percent of bank branches offering
discount mortgage rates to first-time home buyers in the
previous survey conducted in December 2013.
"The increasing home mortgage rates will likely weaken the
purchasing power of first-home buyers and curb home buying
demand," said Yang Kewei, a property analyst at CRIC in
Shanghai, adding that liquidity conditions have tightened this
year as banks turn to more profitable loans.
China's housing market began to show signs of losing
momentum at the end of 2013 as local governments took further
tightening measures at the prompting of a central government
worried about the risk of an asset bubble.
To curb speculative home buying, Chinese banks are allowed
to offer as much as a 15 percent discount on loans to first-time
home buyers while second-home buyers have to pay 10 percent
above the benchmark rates.
The tighter mortgage moves add to recent indications of a
cooling down in the property market, raising concerns over the
health of an important driver of the economy.
Some Chinese property developers have been stepping up the
use of sales promotions for some suburban housing
Meanwhile, Industrial Bank said on Monday that
it had halted mezzanine financing for the real estate sector as
it was reviewing its property lending business ahead of a new
set of internal management rules to be introduced in March.
But the official Xinhua news agency said this week that
China's major lenders have not tightened or halted their
property-related lending business.
(Reporting By Xiaoyi Shao and Kevin Yao; Editing by Chris