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Showing posts with the label Bank of China

HKMA raises home down-payment ratio. How will this affect HK property prices?

The Hong Kong Monetary Authority (HKMA) has ordered local banks to tighten down-payment ratios for home buyers for the fourth time in the past two years as part of an ongoing attempt to control the rates of surging property prices in Hong Kong.

Buyers of homes costing more than HK$10 million will be required to increase up-front payments to 50 percent, it was announced on Friday. For properties valued between HK$7 million and HK$10 million, home buyers will have to pay 40 percent up front with the maximum loan amount capped at HK$5 million.

Buyers of properties valued below HK$7 million can still make a down-payment of 30 percent with the loan capped at HK$4.2 million.

Home prices in HK continue to rise, both as a result of ultra-low mortgage rates which appear to stay low for an "extended period of time", an due to an influx of mainland buyers, tight land supply and increased demand by foreigners wanting to move to Hong Kong as a base for business activities across Asia, …