(Yicai Global) Aug. 10 -- Two of China's big state-backed banks, Industrial and Commercial Bank of China and Agricultural Bank of China, recently set a 10 percent discount off their first-home mortgage rates, up from a previous 5 percent in Shanghai, in good news for first-time buyers.
Interest rates for a second home remained unchanged at 10 percent above the benchmark rate.
ICBC’s Shanghai branch offered a 10 percent discount off the first-home mortgage rate Prior to April 26. Then, it adjusted the discount to 5 percent for all new properties with pre-sale certificates and second-hand houses signed after that day.
This means that the rate rose to 4.655 percent from 4.41 percent. ICBC altered the policy again yesterday by restoring the 10 percent discount, while ABC’s Shanghai branch copycatted it, as financial media 21st Century Business Herald reported today.
The other two of China's four big state-owned banks, China Construction Bank (CCB) and the Bank of China (BOC), have maintained a 10 percent discount off their first-home mortgage rates in recent months.
Shanghai is the only first-tier Chinese city to offer first-home mortgage rate discounts. Among the 35 cities financial research institute Rong 360 monitored in July, the first-home mortgage rate hit bottom at 5.16 percent in Shanghai, while peaking at 6.35 percent in Wuhan, capital of east-central Hubei province.
The average figure reached 5.67 percent across the country in the same period in a sign of across-the-board easing of controls in the cooling market many pundits have predicted for the second half.
Editor: Ben Armour