China's Central Bank and Financial Commission Implement Measures to Stabilize Real Estate Market

On September 30th, the Central People's Bank of China and the National Financial Regulatory Commission unveiled a series of measures med at stabilizing the real estate market.

By October 31, 2024, mortgage rates for primary residences, second homes, and beyond must be reduced by no less than 30 basis points below the Loan Prime Rate LPR. This initiative alleviate financial burdens on homeowners. The top 18 commercial banks are expected to present their adjustment plans before October 12.

For individuals purchasing commercial housing, minimum down payment ratios have been lowered to a minimum of 15 for both first-time and second-home purchases. A refined mechanism will also be implemented for interest rate pricing for individual commercial housing mortgages to enable dynamic adjustments based on agreements between borrowers and banks.

The central bank will provide funding support for financial institutions that issue loans to assist local state-owned enterprises in acquiring unsold commercial properties at reasonable prices for use as affordable housing purposes.

Some existing real estate market financing policies are also exted through these stimulus measures. These initiatives follow a recent decision by the Political Bureau of the Communist Party of China Central Committee, which highlighted efforts to reverse the real estate market downturn and stabilize its performance.

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