The local economic outlook is unclear, bank mortgage lending is still prudent, and coupled with the high level of Hong Kong dollar interest rates, it is expected that banks will have less room to cut interest rates in the first half of the year, mainly with small discounts such as cash rebate to customers
The economy has not improved. Mortgages should be prudent.
Since the second half of last year, Hong Kong’s bank lending has become prudent, with interest rate hikes and discounts reduced on several occasions. However, in the new year, many banks have increased their rebates to attract customers, does it mean that a new round of mortgage grabs will start?
First of all, Hong Kong’s economy is not clear, the unemployment rate has risen to a two-year high of 3.2%, and retail and catering services are more severe. The government estimates that there may be a wave of layoffs after the Lunar New Year, and the overall unemployment rate will further deteriorate. Employment and salary directly reflect the ability to provide housing. If the economy does not improve, mortgage loans should be prudent.
High interest rates at high interest rates
Secondly, the bank loan-to-deposit ratio rose slightly to 86.9% in December. The growth rate of deposits plummeted, and the Hong Kong dollar interest rate was still at a high level. The cost of borrowing was high. With reference to the current one-month mortgage rate for general mortgages, it was about 2.08%, which was higher than last year. About 1% doubled during the same period. In addition, if the general H is calculated as H plus 1.3%, the interest rate is about 3.38%, which is more than the capped interest rate of 2.5%, indicating that the marginal profit of the mortgage is thin, and it is expected that it is difficult for banks to cut interest rates in the quarter.
The United States has changed from raising interest rates to reducing interest rates
This year is the US election year. Although the Sino-US trade war will usher in the first phase of the agreement, reaching the second phase is also full of many uncertain factors that will affect the future US economic outlook and monetary policy. Under the exchange rate system, it will indirectly affect the trend of Hong Kong dollar interest rates, which may bring many unknown changes to bank borrowing and buyer’s mortgage.
However, mortgages are relatively low risk and are one of the important business sectors of banks. Traditional New Year will be more active. It is expected that this quarter will mainly attract customers such as rebates or linked account discounts, especially the newly created mortgage market, which can attract new high-quality customers. The market as a whole will maintain a low interest rate environment. We must also pay attention to whether there will be a small spring in the property market after the Lunar New Year, which is expected to promote the enthusiasm of banks for mortgages in the second quarter.