利息升高 首套房首付比例下降

Recently in Shanghai, branches of Industrial and Commercial Bank of China and other lenders, including the Postal Savings Bank of China and the Bank of Communications, say the new first time home buyers can pay their mortgage loans under the benchmark interest rate.

Shanghai branches of the China Construction Bank or CCB, have issued the encouraging policy on first home loan rates to entice qualified potential buyers. One bank employee explains:

"According to the customer's credit records and repayment abilities, we can adjust the loan rate. On the special conditions, some customers will be entitled to a 10% discount on first home loan rates."

Xue Jianxiong, a senior analyst at the China Real Estate Information Corporation, says the China's central bank adjusted the deposit-reserve ratio last November, making additional 400 billion yuan available and the lending quotas more flexible.

"I think both the deposit-reserve ratio and the interest rate will probably be reduced in 2012. That means the banks are supposed to lend more loans in a relatively relaxed environment and provide some discounted loan rates."

Last year, however, the central bank, the People's Bank of China raised the mortgage rate three times. The five-year benchmark mortgage loan rate has hit 7.05 percent, up from 6.4%. The latest interest rate hike took effect on the New Year's Day. That means people will have to pay more for their mortgage loans now.

Take a 30 year loan of 100 million yuan as an example. Home buyers will now need to pay 430 yuan more monthly on their mortgage under the 7.05% loan rate, up to 6680 yuan a month. So eventually the home buyers will need to pay over five thousand yuan more in total annually.

Now a rising number of home buyers are considering whether they should pay off their loans earlier.

Gao Qiming, an officer in the Industrial and Commercial Bank of China, says although the mortgage loan rate has surged, for home buyers who are tight on capital it's not worthwhile repaying the loans in advance.

"Compared to other personal loans, the loan rate for home buyers is low. For example, self-employed and private entrepreneurs need enough funds to run their business. So it's not suitable for them to pay off loans ahead of time."

Some market insiders predict that would-be first time home buyers will secure loans around the Chinese New Year holiday. They have been waiting for the loans due to the tight lending quota last year.

For CRI, I'm Wang Wei.