The latest official data from the Chinese central bank indicates that real estate-related lending saw a modest decline in growth in the first quarter of 2018.
The People’s Bank of China’s Q1 Financial Institution Lending Direction Statistical Report (一季度金融机构贷款投向统计报告) indicates that as of the end of March the total balance of renminbi loans by Chinese financial institutions was 125 trillion yuan, for year-on-year growth of 12.8% and an acceleration of 0.1 percentage points compared to the end of last year.
The first quarter of 2018 saw 4.9 trillion yuan in new loans, for an increase of 633.9 billion yuan compared to the reading for the first quarter of 2017.
By contrast the same period saw a modest decline in real estate loans, the balance for which stood at 34.1 trillion yuan as of the end of the first quarter. Real estate loans saw YoY growth of 20.3%, which is 0.6 percentage points slower than the figure at the end of last year.
The first quarter saw a total of 1.9 trillion yuan in new real estate lending, with its share of all new lending in the same period falling by 2 percentage points compared to the end of 2017.
The personal home loan balance was 22.86 trillion yuan as of the end of the first quarter, for YoY growth of 20%, and a deceleration of 2.2 percentage points compared to the end of 2017.
Personal home loans in China posted YoY growth of 35% in the first quarter of 2017, and the 994.9 billion yuan in personal home loans made in the first quarter of 2018 is 175 billion yuan less than credit extended in the same period last year.
Beijing’s drive to expand the urban home leasing market and affordable housing has spurred growth in funding for developers, however, with housing development loans leaping by 25.3% in the first quarter, for an acceleration of 3.6 percentage points compared to the preceding quarter.
Personal business loans also received a boost from central government policies, with Beijing’s push for greater financial inclusion driving their growth rate to a record YoY high of 9.4%.
Lian Ping (连平), chief economist with the Bank of Communications, said to People’s Daily that the growth in domestic household consumption as well as ongoing improvements to the environment for individual entrepreneurs will lead to a steady rise in personal consumer loans and business loans, as well as drive positive adjustments to the household lending structure.