By South China Morning Post | Created at 2024-10-16 11:18:37 | Updated at 2024-10-16 14:12:06
3 hours ago
Hong Kong has taken steps to revive the city’s property market by easing mortgage financing rules to pre-2009 levels, after a policy tweak in February produced only a short-lived burst.
Homebuyers will be able to obtain as much as 70 per cent financing effective immediately, regardless of the value or use of property, the Hong Kong Monetary Authority (HKMA) said in a statement. The debt-servicing ratio has been raised to 50 per cent from 40 per cent, standardising the level for both residential and non-residential properties, it added.
Developers and property agents welcomed the news, which they said would boost transactions and arrest the decline in prices.
Homes valued at more than HK$30 million (US$3.8 million) will be entitled to 70 per cent mortgage financing, compared with 50 per cent to 60 per cent previously, HKMA said. Chief Executive John Lee Ka-chiu earlier announced the initiative in his policy address.
HKMA CEO Eddie Yue Wai-man said the changes were made based on the current condition of the property market. The revision also meant that mortgage policies have been rolled back to what they were before 2009.
“Even with these adjustments announced today, the Hong Kong banking sector has ample buffers to cope with any challenges from a sharp correction in property prices,” Yue said in the statement.
