Banks in Shanghai seek stricter home deposit
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Banks in Shanghai have asked home buyers to place a down payment that is above regulatory requirement on their second homes amid the central government's tight control on housing loans, the local banking regulator said Thursday.
Banks required an average 64 percent down payment on second homes in March, up from 56 percent in January, because of a tighter regulatory requirement, said the Shanghai Bureau of the China Banking Regulatory Commission, quoting data from four lenders.
China launched its toughest measures to curb surging prices and speculation in the home market in January. On January 26, the State Council, China's Cabinet, increased the minimum down payment on second homes from 50 percent to 60 percent, with interest rates 1.1 times the benchmark rate in a bid to drive out credit-driven speculation. Banks are also banned from offering loans to third or more homes.
In February, most banks, including the Industrial and Commercial Bank of China and the Bank of China, stopped giving rate discount for first home buyers. Previously, a 15 percent discount on mortgage rates was given on first homes.
China tightened its monetary policy this year, shifting from moderately easing to prudent.
Some banks even halted granting mortgages against the backdrop, the CBRC said, without naming the banks.
The outstanding value of bad loans in real estate dropped to 3.5 billion yuan at the end of March, down 320 million yuan.
