China’s central government is allowing nearly two dozen cities to lower mortgage rates for purchases of primary residences, in a move analysts said was likely to provide only limited help for the country’s struggling housing market, reports Bloomberg. Eligible cities will be able to maintain, lower or remove the minimum interest rates set for loans that go toward primary-home purchases in their jurisdiction, according to a statement from the central bank and banking regulator late on Thursday evening Beijing time.
The permission will last through year-end and the new rates can be negotiated between banks and their customers.
The new policy will apply to cities where newly constructed housing prices declined during the June-through-August period both compared with the previous three months and with the same period of 2021, according to the statement. Existing rules for second-home mortgage loans remain unchanged. Earlier on Thursday, China’s central bank vowed to accelerate usage of targeted loans to ensure delivery of delayed property projects.