Recently, there has been big news in the mortgage market, with several cities announcing the removal of the lower limit on commercial loan rates for first homes. Including Fuzhou, Nanchang, Jining, Ganzhou, Qingdao, Yantai and other cities, 15 cities in Guangdong have joined the ranks. What is the reason for the introduction of this policy, and how will it affect the property market? Is now the best time to buy a house? and how to make a choice for people and investors?
We have to figure out why many places have removed the lower limit of mortgage interest rates. Since 2024, the property market in many cities is still at the bottom, and the market demand is weak. In order to stimulate the property market, a series of easing policies have been adopted, and the abolition of the lower limit of mortgage interest rates is one of them.
The absence of a floor means that differentiated housing credit policies can be broken through. If it is the first home, according to the regulations, it can break the minimum LPR-20 standard. The introduction of this policy means that banks can set loan interest rates more flexibly, thereby reducing the loan to home buyers. The most direct effect of abolishing the lower limit of mortgage interest rates is to reduce the burden on home buyers.
In the current low interest rate environment, home buyers can enjoy lower loan interest rates, which is undoubtedly beneficial to boost the demand of the property market. In the first quarter of 2024, the average monthly transaction scale of newly built commercial residential buildings in key 100 cities decreased by about 40% compared with the same period in 2023. The introduction of this policy is expected to promote market recovery in the second quarter.
So, is now the best time to buy a house? For those who just need it, if the economic conditions allow, now is indeed a good time to buy a house. The reduction of mortgage interest rates can reduce the cost of buying a house, and the government has a series of policies to stimulate the property market.
But if you want to invest in buying a home, you need to be very cautious. At present, the real estate industry has undergone fundamental changes, the recovery of the property market will take time, and there are still many uncertainties in the trend of the market, so for us ordinary people, the idea of investing in buying a house is still try not to be.