Related to the adjustment of stock mortgage interest rates! The central bank releases heavyweight signal loans | interest rates | mortgage interest rates
"Continuing to guide the downward trend of personal housing loan interest rates and down payment ratios" and "guiding commercial banks to adjust the interest rates of existing personal housing loans in an orderly manner in accordance with the law", the central bank has issued clear policy signals.
On August 1st, the People's Bank of China and the State Administration of Foreign Exchange held a work conference for the second half of 2023, summarizing the work of the first half of the year, analyzing the current situation, and deploying the next stage of work. Among them, multiple heavyweight proposals have attracted market attention in supporting the stable and healthy development of the real estate market.
Orderly adjustment of existing housing loan interest rates
The central bank stated that it will implement differentiated housing credit policies precisely based on urban conditions, continue to guide the downward trend of individual housing loan interest rates and down payment ratios, and better meet the rigid and improved housing needs of residents. Guide commercial banks to lawfully and orderly adjust the interest rates of existing personal housing loans.
Not long ago, at a press conference of the State Council Information Office, Zou Lan, Director of the Monetary Policy Department of the People's Bank of China, pointed out that it supports and encourages commercial banks to negotiate independently with borrowers to change contract agreements, or to issue new loans to replace existing loans.
This announcement immediately attracted public attention, and the market is also looking forward to the implementation of relevant policies.
"Lowering the interest rate on existing housing loans is a good way to curb the trend of early repayment, thereby alleviating the adverse impact of the latter on the operation of commercial banks and creating favorable conditions for driving consumer growth and economic recovery." Zhang Xu, a fixed income analyst at Everbright Securities, said that when adjusting the interest rate on existing housing loans, both commercial banks and borrowers can negotiate and change the contract agreement independently, or loan replacement can be used.
Based on this, he proposed five suggestions: firstly, the reduction of interest rates on existing housing loans should be determined through independent negotiation between commercial banks and borrowers based on the principles of marketization and legalization, and financial management departments should not make mandatory requirements or unified arrangements for the reduction; The second is to adopt the model of "banks providing solutions and customers making choices"; Thirdly, it is recommended to design the plan for contract changes and loan replacement as concise and easy to understand as possible; Fourthly, notify all personal mortgage clients through various means; Fifth, the financial management department should provide appropriate policy incentives or support. For example, the central bank can establish structural monetary policy tools, carry out targeted or comprehensive reserve requirement reductions, etc.
Dong Ximiao, Chief Researcher of Zhaolian Finance, suggests that the overall principles for adjusting the interest rates of existing mortgage loans in banks should be agreed upon through a self regulatory mechanism for market interest rate pricing; It is recommended that each bank's head office introduce specific plans to clarify the conditions, standards, and processes for "direct reduction" and "indirect reduction". Where conditions permit, greater support can be provided to borrowers to convert commercial housing loans into provident fund loans, in order to further reduce the interest rate of existing housing loans.
At the work meeting, the central bank also stated that we will implement the "16 Financial Measures", extend the implementation period of the guaranteed housing loan support plan, maintain stable and orderly real estate financing, and increase financial support for housing leasing, urban village renovation, and affordable housing construction.
Accelerated pace of industry policy adjustment
In fact, the optimization of real estate related policies is imminent.
On July 24th, the Political Bureau of the Central Committee held a meeting and clearly stated that "to adapt to the new situation of significant changes in the supply and demand relationship of China's real estate market, we should adjust and optimize real estate policies in a timely manner.".
On July 27th, during an enterprise symposium held by the Ministry of Housing and Urban Rural Development, it was pointed out to further implement policy measures such as reducing the down payment ratio and loan interest rate for purchasing the first home, improving the reduction of tax and fee for purchasing affordable housing, and allowing individuals to apply for housing loans without applying for loans.
Recently, the central bank, Ministry of Housing and Urban Rural Development and other departments are accelerating the pace of industry policy adjustments. Market analysis suggests that in the future, there is room for optimization in relevant policies from both supply and demand perspectives.
Wang Yifeng, Chief Analyst of the Banking Industry at Everbright Securities Research Institute, believes that from the supply side, policy based property protection tools may still be strengthened in the future; There is also room for development in loans related to affordable housing projects. At the same time, "anti riot mine" remains a key area of policy focus in the next stage, stabilizing market expectations and preventing risk diffusion may require targeted assistance to typical real estate enterprises; From the demand side, the restrictive policies imposed during the overheated stage of the real estate market in the early stage will gradually withdraw, which may include further optimization of policies in first and second tier cities, especially for the "newly renovated" group, where there is significant room for policy optimization. This will help boost the recovery of real estate sales and drive the recovery of the scale of newly issued mortgage loans.
In terms of adjusting and optimizing real estate policies, Wang Qing, Chief Macro Analyst of Dongfang Jincheng, predicts that the next measures may include: moderately relaxing loan and purchase restrictions, including in some areas of first tier cities, under the principle of implementing policies based on urban conditions, increasing support for housing provident fund purchases in various regions, accelerating the nationwide promotion of the "mortgage transfer" model, activating the second-hand housing market, and further guiding residents to lower mortgage interest rates, and even moderately lowering stock mortgage interest rates. "In the second half of the year, LPR quotations for more than 5 years may be separately lowered. The overall goal is to guide the real estate industry to achieve a soft landing as soon as possible. This is of great significance for stable growth and risk prevention in the second half of the year."
