Chinese property stocks rallied on Tuesday after top financial regulators pledged a range of monetary easing measures. The People's Bank of China (PBOC) Governor Pan Gongsheng announced a reduction in existing individual mortgage interest rates by an average of 0.5 percentage points and lowered the down payment ratio for second homes to 15% from 25%. These measures aim to provide relief for millions of families and stimulate recovery in the real estate market.
People's Bank of China Gov. Pan Gongsheng on Tuesday announced that Beijing would reduce the interest rates on existing individual mortgages by an average of 0.5 percentage points, and the lower down-payment ratio for second homes purchases to 15% from 25%.
Hong Kong-listed shares of real estate developers like China Resources Land, Longfor Group Holdings and China Overseas Land & Investment were some of the biggest movers, gaining as much as 2.84%, 3.31% and 4.22%, respectively.Streaming 24/7: Watch NBC 5 local news and weather for free wherever you are
During a high-level press conference Tuesday morning, People's Bank of China Gov. Pan Gongsheng announced that Beijing would reduce the interest rates on existing individual mortgages by an average of 0.5 percentage points, and the lower down-payment ratio for second homes purchases to 15% from 25%.
The impacts from the new measures are likely to be limited as"rate cuts on existing loans would not spur demands for new homes, and might slow down PBOC's pace of further lowering the loan prime rates," William Wu, an analyst at Daiwa Capital Markets, said in an email, according to CNBC's translation of the Chinese.
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