Since the concept of "housing is for living, not for speculation" was put forward at the Central Economic Work Conference at the end of 2016, relevant departments and enterprises in the real estate industry have been greatly affected.
There have been corresponding fluctuations in aspects including real estate financing and home buyer credit.
The Central Economic Conference held in Beijing in December 2016 further confirmed the basic positioning of housing for living, not for speculation, and local governments responded to the national call.
promotes the stable development of the local real estate industry market and has also carried out various policy reforms including fiscal taxation, investment, and finance.
In recent years, home purchase policies in many regions have gradually shown signs of easing, especially in terms of mortgage interest rates. Many regions have made corresponding adjustments in terms of mortgage interest rates and down payment ratios.
Mortgage interest rates have even dropped to 4.4% in most areas. So what should residents who bought houses at around 5% to 6% do?
Changes in mortgage interest rates in recent years
"Catching a large number of real estate speculators" seems to have happened a long time ago, but in fact, it has not been long since the policy of "living in, not speculating" has been "implemented to the end."
It has only been six years since the concept of "houses for living, not for speculation" was proposed in December 2016, and the credit side of the domestic market has been greatly affected.
From a credit perspective, home purchase policies in various regions of the country have been gradually relaxed in recent times.
The real estate industry has seen a series of related policies such as lowering mortgage interest rates, increasing the maximum limit of provident fund loans, and reducing down payment ratios.
The purpose of these policies introduced by the government is to help the domestic real estate industry gradually pick up and restore its original vitality and vitality during this special period.
On May 15, 2022, in the official document on "Real Estate Credit" jointly issued by the Central Bank and the China Banking and Insurance Regulatory Commission, it was clearly stated that the lower limit of the first home loan interest rate would be directly reduced by 20 basis points.
Regional governments can implement "city-specific policies" according to different situations. Not long after the notice was released, the five-year LPL interest rate was reduced by a cumulative 15 BP.
Due to the influence of these two dual factors, most areas in the country have been affected and have begun to follow up on relevant policies and activities regarding lowering the level of housing loans.
The Hohhot Housing and Urban-Rural Development Bureau is already one of the earlier areas to take action. On June 7, 2022, the Hohhot Housing and Urban-Rural Development Bureau issued a policy to "directly lower the minimum interest rate for individual medium- and long-term housing loans to 4.25%." information.
Not long ago, regions including Hebei Tangshan , Jiangsu Xuzhou, Sichuan Suining and other regions also announced signals about the loosening of housing provident fund loan policies.
In fact, in the five years from 2017 to 2021, mortgage interest rates across the country have been on an upward trend. According to the average data in most regions, residents want to buy their first home. The mortgage interest rate that
needs to pay is generally between 5.6% and 6.3%. At that time, residents still believed that housing not only had residential value, but more importantly, had "investment value", so a large number of home buyers appeared on the market.
But now the situation is very different. As of April 2022, most banks in Shandong have taken the lead in lowering personal housing loans to 4.6%.
Many banks in Zhengzhou, Henan, have already lowered their mortgage interest rates to 4.4%; Hohhot also announced that they will lower their loan interest rates to about 4.25%.
The reduction of mortgage interest rates is naturally the implementation of the corresponding policy calls of banks in various regions, but how should those residents who purchased properties under the mortgage interest rates of 5.6%-6.3% in the past few years face it?
How will those who buy houses at high interest rates be affected?
The decline in mortgage interest rates in recent years has actually brought great convenience and dividends to residents who have recently needed to buy houses. They no longer have the huge pressure of the previous batch of home buyers.
Then some people will think that since the mortgage interest rate is now lowered, will the monthly payments of those residents who bought a house before and have not yet paid off the loan become easier?
Let me start with the conclusion here. The monthly payments for those who bought houses with loan interest rates of 5.6% to 6.3% will not change.
The composition of the mortgage interest rate is LPR plus or minus basis points. Here LPR is translated into loan market quoted interest rate .
means that the loan interest rate data implemented by major financial institutions for the best customers in the market largely represents the lowest limit of loan pricing by financial institutions.
Other loan interest rates are basically determined by adding or subtracting points based on the loan market quoted interest rate.
Usually after the mortgage loan is disbursed, each home buyer's mortgage interest rate plus or minus basic points is already a fixed value. Whether the mortgage interest rate will be adjusted in the later period is all determined by the fluctuation of LPR.
In other words, if users who previously had loan interest rates of 5.6% to 6.3% want to reduce their monthly payments, they can only expect the central bank to cut interest rates quickly, that is, directly reduce the LPR value.
There are many old property owners who have purchased real estate before. They have incomplete understanding of the recent policy of lowering mortgage interest rates. They always think that they will be profitable if the mortgage interest rates are lowered, but in fact this is not the case.
If the old owner contacts the local real estate account manager or mortgage broker, he can find out before adjusting the loan interest rate.
Owners who have signed the house purchase contract cannot enjoy the latest mortgage interest rates, and all will be based on the interest rates stipulated in the contract at that time.
The future trend of mortgage interest rates
Nowadays, various regions in the country have introduced new regulations to adjust interest rates. They also want to mobilize the enthusiasm of domestic residents to buy houses by reducing the pressure on everyone's mortgage loans, so as to restore the former vitality and vitality of the real estate industry.
The adjustment of mortgage interest rates can be said to be an absolutely preferential policy that is beneficial to those who are in urgent need of buying a house. What do traditional old owners who "recognize loans but not houses" from banks think about the newly adjusted mortgage interest rates.
can moderately sell the properties under his name, so that he can purchase the relevant properties according to the mortgage interest rate for the first home.
As one of the important factors that home buyers need to consider, mortgage interest rates have been constantly adjusted.
started in August 2019. The central bank no longer publishes the benchmark loan interest rate, but instead publishes the loan market quoted interest rate, which is the LPR mentioned above.
From a long-term perspective and in recent years, the overall trend of LPR is a downward trend.
Due to the various disputes and impacts caused by the epidemic and international events, the real estate industry has been facing turmoil, and the policies and credit policies of various regions in the country are also relatively loose.
The loose environment will inevitably bring about loose loan policies and interest rates. It is no exaggeration to say that falling interest rates has become a major international trend.
When the economy develops to a certain extent, interest rates will definitely remain at a relatively low level, and there may even be a state of negative interest rates .
But it is unknown what factors will affect the adjustment of mortgage interest rates in the future market.
Conclusion
In fact, from the perspective of lenders, the expected further reduction in mortgage interest rates has become an objective fact. Users who are in urgent need of buying a house can seize the opportunity to actively buy a house.
At the same time, those old property owners who have purchased real estate do not need to worry too much. No one can control market fluctuations.
No one could have expected that mortgage interest rates would be lowered a few years ago. So it’s better to settle down and pay your monthly payments on time and make financial plans.
What do you think of today’s mortgage interest rates? Welcome to leave a message in the comment area for discussion.
The composition of the mortgage interest rate is LPR plus or minus basis points. Here LPR is translated into loan market quoted interest rate .
means that the loan interest rate data implemented by major financial institutions for the best customers in the market largely represents the lowest limit of loan pricing by financial institutions.
Other loan interest rates are basically determined by adding or subtracting points based on the loan market quoted interest rate.
Usually after the mortgage loan is disbursed, each home buyer's mortgage interest rate plus or minus basic points is already a fixed value. Whether the mortgage interest rate will be adjusted in the later period is all determined by the fluctuation of LPR.
In other words, if users who previously had loan interest rates of 5.6% to 6.3% want to reduce their monthly payments, they can only expect the central bank to cut interest rates quickly, that is, directly reduce the LPR value.
There are many old property owners who have purchased real estate before. They have incomplete understanding of the recent policy of lowering mortgage interest rates. They always think that they will be profitable if the mortgage interest rates are lowered, but in fact this is not the case.
If the old owner contacts the local real estate account manager or mortgage broker, he can find out before adjusting the loan interest rate.
Owners who have signed the house purchase contract cannot enjoy the latest mortgage interest rates, and all will be based on the interest rates stipulated in the contract at that time.
The future trend of mortgage interest rates
Nowadays, various regions in the country have introduced new regulations to adjust interest rates. They also want to mobilize the enthusiasm of domestic residents to buy houses by reducing the pressure on everyone's mortgage loans, so as to restore the former vitality and vitality of the real estate industry.
The adjustment of mortgage interest rates can be said to be an absolutely preferential policy that is beneficial to those who are in urgent need of buying a house. What do traditional old owners who "recognize loans but not houses" from banks think about the newly adjusted mortgage interest rates.
can moderately sell the properties under his name, so that he can purchase the relevant properties according to the mortgage interest rate for the first home.
As one of the important factors that home buyers need to consider, mortgage interest rates have been constantly adjusted.
started in August 2019. The central bank no longer publishes the benchmark loan interest rate, but instead publishes the loan market quoted interest rate, which is the LPR mentioned above.
From a long-term perspective and in recent years, the overall trend of LPR is a downward trend.
Due to the various disputes and impacts caused by the epidemic and international events, the real estate industry has been facing turmoil, and the policies and credit policies of various regions in the country are also relatively loose.
The loose environment will inevitably bring about loose loan policies and interest rates. It is no exaggeration to say that falling interest rates has become a major international trend.
When the economy develops to a certain extent, interest rates will definitely remain at a relatively low level, and there may even be a state of negative interest rates .
But it is unknown what factors will affect the adjustment of mortgage interest rates in the future market.
Conclusion
In fact, from the perspective of lenders, the expected further reduction in mortgage interest rates has become an objective fact. Users who are in urgent need of buying a house can seize the opportunity to actively buy a house.
At the same time, those old property owners who have purchased real estate do not need to worry too much. No one can control market fluctuations.
No one could have expected that mortgage interest rates would be lowered a few years ago. So it’s better to settle down and pay your monthly payments on time and make financial plans.
What do you think of today’s mortgage interest rates? Welcome to leave a message in the comment area for discussion.
