Beijing and Shanghai have implemented new mortgage rules to stabilize the real estate sector, following similar adjustments made by Guangzhou and Shenzhen earlier in the week. These changes allow homebuyers to enjoy preferential treatment for first-home purchases regardless of their credit history.
Experts believe that these actions by first-tier cities could lead to other regions adopting similar measures, which would contribute to the stable development of the property market. The first-tier cities often set the tone for the national real estate market.
Anhui Province, Suzhou in Jiangsu Province, and Nanning in Guangxi Zhuang Autonomous Region have also announced plans to ease mortgage rules. These measures aim to reduce the cost of buying a home and boost demand, with the effects expected to become evident as early as September and October, which are typically peak months for real estate transactions.
The Chinese government has been providing supportive measures to stimulate the property market, including lowering down payments for both first-time and second-time homebuyers and cutting interest rates on existing mortgages.
Song Ding, a research fellow from the China Development Institute, believes that these supportive measures will stabilize market expectations and consumer confidence in both the real estate sector and the broader economy, addressing challenges posed by factors such as COVID-19, external impacts, and imbalances in the fast-growing economy.