The latest data from China’s central bank shows a marked slowing in the growth of personal home loans, as well as the possibility of further rises in borrowing rates.
According to data released by the People’s Bank of China March saw the first year-on-year deceleration in personal home loan growth in nearly two years.
PBOC figures indicate that personal home loans increased by 361.7 billion yuan in March, falling by 22.2 billion yuan compared to the same period in 2016 and the first such decline in nearly 23 months.
In April new mortgage loans as a share of all new lending fell by 3.7 percentage points compared to the previous month to 40.4%.
Property market control policies launched by local governments began to take strong effect in April, with data from the National Bureau of Statistics indicating that as many as 15 first-tier and hotspot second-tier cities saw year-on-year declines on new commercial housing prices.
PBOC notes that personal home loan rates saw a slight rise in March to a weighted average of 4.55%, for a gain of 0.03 basis points compared to December.
Domestic analysts say that banks could continue to lift rates as their capital costs rise in the wake of two money market hikes by PBOC since the start of the year, with a view to reducing their exposure to property markets hampered by restrictive policies