20% down payment, the property market is big change


Reducing the down payment ratio can promote the purchase intention.File photo: The city is full of buildings.China News Service reporter Wang Dongming photo 2022 just spring, the property market was fired “when the first gun.”In many places, the down payment policy began to loosen substantially, with the down payment ratio for the first house dropping to 20%.Compared with the reduction of reserve requirement, interest rate and provident fund loan quota, the reduction of down payment ratio can obviously promote the improvement of purchase intention.What impact will this have on the year of the Tiger?As low as 20%!On February 17, the news that some banks in Heze city, Shandong Province lowered the down payment ratio of personal housing loans attracted attention.Specifically, some banks in Heze said they would adjust the down payment ratio according to the situation of home buyers, among which the down payment ratio of “no house no loan” home buyers was reduced to 20%.February 18, Heze related departments responded to the media said that there was no unified adjustment of the down payment ratio, still implemented in 2016 the minimum 20% of the first suite down payment ratio requirements.This adjustment is part of the bank according to their own situation and mortgage demand independent management behavior.Heze mentioned the proportion of down payment requirements, based on the People’s Bank of China, the former China Banking Regulatory Commission issued a notice in 2016, in the first suite mortgage of urban residents in the lowest proportion of 25%, but around the city can float 5 percentage points, means that the lowest proportion of down payment of non-restricted purchase of the city can be reduced to 20%.”The heze adjustment of personal housing loan down payment ratio, in line with the government provisions of the down payment ratio around the floating range, belongs to the city’s local reasonable adjustment under the policy, the judgment of ‘stable housing prices, stable expectations’ in the context of the downward sales of coping measures.Citic Securities research newspaper point of view.Heze relaxation of lending practices are also tractable.Monitoring data from E-House Research Institute showed that the real estate market in Heze cooled rapidly in the second half of 2021.For example, after the new house sales in Mudan District, Heze City reached a stage high in October 2021, both the transaction volume and the average transaction price fell rapidly.”The adjustment of the down payment ratio, especially for first-time homes, will help release rigid demand for home purchases and have a positive significance for accelerating market stability.”Shell Research institute senior analyst Pan Hao believes that the introduction of policies at this time to encourage just need to enter the market is the need to stabilize the market.In addition to Heze, other cities across the country have also taken steps to reduce the first home mortgage interest rate and down payment ratio.Ganzhou, Jiangxi province, for example, lowered the down payment ratio before the Spring Festival, allowing a “20% down payment” for first homes.In Chongqing, people without a house or a loan have recently started to make a 20% down payment.Another media learned from guangdong Foshan more than intermediary, the recent non-restricted areas of some real estate down payment reduced to 20%.”A few years ago, only some buildings supported 20% down payment, and only targeted at people with good credit investigation qualifications. Recently, the scope of support has been expanded, and sometimes the qualification of the lender is also more relaxed.”Chongqing local property distribution personnel said to the media.File photo: Chongqing Yuzhong Peninsula bright lights.China News Agency reporter Chen Chao took the first suite of spring, the housing market bottom signal?Throughout the above cities, the industry concluded that this round of adjustment cities are not “purchase restriction” cities, which are jointly decided by local housing and financial functional departments according to the policy principle of the city.Under the 2021 mortgage concentration policy, the practice of 20% down payment is very rare.Why have places been reintroducing this tactic lately?Chen Wenjing, deputy director of the Index Division of the Middle Index Research Institute, explained that since the fourth quarter of 2021, several cities across The country have optimized and adjusted property-related policies, such as increasing the loan quota of provident fund, reducing the down payment ratio of provident fund loans, lowering mortgage interest rates and granting housing subsidies.”But the overall effect is not obvious, buyers’ property sentiment has not seen a significant improvement, market activity is still insufficient.””Only commercial bank loans to reduce the down payment is the most core, and from the actual process, reduce the down payment is the best measure.”E-house Research Institute think tank center research director Yan Yuejin agreed.Support for adjusting the first home loan signal has already been released.In October 2021, a CBRC official said at a press conference that at present, more than 90% of individual housing loans are loans for first homes, and banks will support first-time home buyers in terms of loan down payment ratio and interest rate.Pan Hao pointed out that in the past decade, There were two market bottoming processes in China, namely “2014-2015” and “2020-2021”, which were at the two lows of the growth rate of commercial housing sales area in China respectively. In the process of market bottoming correction, a series of regulatory policies were accompanied to promote the growth level to stop falling and stabilize.”The same transmission path of such policies has occurred in credit, starting with credit rates, followed by changes in provident fund related policies, and finally to commercial loans.The adjustment of commercial lending policy has sent a signal that the market is bottoming.””Pan Hao said.”It is expected to have a better market sentiment, the wait-and-see sentiment of home buyers may be improved, the confidence of home buyers will be boosted to some extent.”Chen wenjing also said that more cities may follow suit in the future, especially third – and fourth-tier cities with weak urban fundamentals and greater market adjustment pressure.

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