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China on Wednesday announced 16 supportive financial measures to ensure stable development of the real estate sector. This is an important step for the country to stabilize market expectations for the health of the sector, experts said.
China’s central bank, the People’s Bank of China, and the China Banking and Insurance Regulatory Commission, jointly said they should strive to stabilize financing for property development and treat state-owned and private developers alike. Stated. release on wednesday.
Banks facing difficulties in meeting regulatory limits on concentration of lending to the real estate sector due to COVID-19 could reasonably be allowed to have a longer period to adjust their lending structure. , said the notice.
The state will support development banks and policy banks to provide special loans aimed at ensuring the delivery of housing projects and facilitate additional financing related to the loans, the circular said.
Reasonable extensions of both loans related to property development and mortgages taken by individuals affected by COVID-19 will be encouraged, according to the circular.
To meet reasonable demand for home purchases, the state will help local authorities set reasonable minimum down payments and mortgage interest rates based on the actual situation of the local real estate market, the circular said. .
It also said that criteria for first-time homebuyers need to be rationally determined in order to optimize financial services for homebuying by newcomers to the city.
China Minsheng Bank chief economist Wen Bin said the 16 measures formally announced on Wednesday outline a comprehensive solution to tackle the challenges faced by property enterprises and relevant stakeholders. Said there was
The measure is expected to play a positive role in easing the cash flow pressures facing businesses and boosting homebuyer confidence, and is key to stabilizing the real estate sector. The goal is to ensure a recovery in home buying demand, he said.
The circular also called for efforts to keep bond lending to the real estate sector stable, support sector mergers and acquisitions, and stabilize credit expansion for construction companies.
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