Likewise, the People's Bank of China announced the reduction to 15% from the previous 20% of the minimum percentage to be disbursed as a down payment for first-time home buyers.
The Chinese Government announced this Friday a series of measures aimed at promoting the recovery of the country's real estate sector by facilitating the "digestion" of the inventory of unsold homes built, for which it will allocate US$ 41,550 million to finance the acquisition of these properties by entities public to provide houses at affordable prices, in addition to lowering the minimum percentage set as an entry fee to be paid by buyers.
The deputy governor of the People's Bank of China, Tao Ling, explained this Friday at a press conference that through this new loan mechanism of US$ 41,550 million, the aim is to encourage financial institutions to support the purchase by public companies of finished homes and not sold "at reasonable prices" for allocation or rental as affordable housing, which is expected to generate bank loans worth US$69.25 billion.
In this sense, the program open to 21 national banks, including the China Development Bank, state commercial banks, establishes an interest rate of 1.75% on one-year loans with the possibility of being extended four times, while the People's Bank of China will issue new loans based on 60% of principal, which may boost bank lending to half a trillion yuan.
"This policy is an important measure introduced by the People's Bank of China to support the construction of a new real estate development model and leads to the achievement of multiple objectives through a market-oriented approach," defended the official, highlighting the goal to "accelerate the clearance of existing housing stock" while boosting the supply of affordable housing, whether for sale or rent.
On the other hand, the People's Bank of China has announced the reduction to 15% from the previous 20% of the minimum percentage to be disbursed as an entry for first home buyers through mortgage loans, while for the acquisition of a second home the threshold will be set at 25% from the previous 30%.
