First Home Loan Rates Rise for 20th Consecutive Month, Hit 5.69% in August


Rates for first home loans in China have just seen their 20th consecutive month of increase as regulators seek to contain the country’s real estate markets.

Data from Rong360 indicates that the average first home loan rate in China was 5.69% in August 2018, equal to 1.161 times the benchmark rate.

The August reading marks a month-on-month rise of 0.35% and a 11.13% rise compared to the rate of 5.12% in August of 2017.

As of the end of August home loan rates in China have risen for 20 consecutive months since January 2017.

The number of banks applying first home loan rates 20% – 30% above the the benchmark rate has also seen an increase.

Out of 533 banks or bank branches monitored in 35 Chinese cities by Rong360, the first home loan rates of 125 were 10% above the benchmark, for a decline of 21 compared to July.

176 banks provided rates 15% above the benchmark, for an on-month increase of 3 banks, while 128 banks provided rates 20% above benchmark, for an increase of 13 banks.

30 banks provided rates 25% above the benchmark, for a 2 bank increase, while 28 banks provided rates  at a 30% premium, for a 3 bank increase.

The data indicates that the number of banks who further raised first home loan rates saw a fall, however, with most banks keeping rates steady.

Only 40 lenders monitored raised first home loans last month, or 7.50% of the total, for a fall of 7 banks compared to July.

488 lenders kept rates steady compared to the preceding month, accounting for 91.56% of the total.