Shanghai mortgages rise 1,600% in 2009

Banks lent out US$14.58 billion in new mortgages in Shanghai in 2009, a 1,600% increase from the previous year, the South China Morning Post reported. Of the total, US$5.7 billion went to buyers of new properties and US$8.88 billion to those buying second-hand properties, according to the People’s Bank of China. Average prices of Shanghai homes rose 68% from 2008. The increase in new mortgages, echoed in rising mortgage issuance around China, is expected to slow in the first half of 2010 as Beijing institutes cooling measures. However, analysts said strong residential property demand would lead to a rebound in prices and sales in the second half of the year.