To facilitate the public to get on the train, the policy address proposes to relax the ceiling on mortgage insurance
It is in response to the fact that there is no more than $4 million in the market. However, the higher mortgage rate makes property more vulnerable to assets, and the economy of Hong Kong is also falling. It must be done with strength.
The Hong Kong Government has relaxed the upper limit of mortgage insurance. Second-hand sales have immediately closed up and reversed prices. Property agents have also greatly sung the property market. Therefore, it is the new measure that will allow first-time home buyers to apply for a maximum price limit of 90% on mortgage loans, from $4 million to $8 million. The maximum price limit for applications for 80% mortgages will be raised from $6 million to $10 million. In the latter case, the latter may include mortgages for self-use buildings, and the industry estimates that potential passengers may increase in multiples. In addition, the new policy allows those who do not meet the stress test to apply, and the premium is increased.
4 million buildings are extinct, measures respond to reality
There has been a call for the relaxation of the mortgage ceiling in the community. As the property prices continue to rise, the units below $4 million that can apply for a 90% mortgage are almost extinct. In recent months, the price of the property has dropped slightly, which has led to a slight increase in such units. Those who wish to get on the bus less can still only hope to sigh.
However, if the bank’s mortgage loan ceiling is relaxed in one fell swoop, it may shake the bank loan quality and increase the potential risk of the financial system. The Hong Kong Government only relaxes the mortgage insurance ceiling. It can be said that it responds to the reality and considers the risk factors of the banking system.
The door-to-door threshold is greatly reduced. For example, the first phase of a 5 million-yuan residential building will be reduced from 1 million yuan to 500,000 yuan. It is inevitable that people who want to get on the train will think about it. However, before entering the market, it is necessary to understand that the pressures and risks of the three aspects have also risen. First, monthly contributions have risen. As the first phase is reduced, the borrowing is increased, and the monthly contribution burden is rising. The property price is 5 million yuan, the interest rate is 2.37 percent, and the 30-year repayment period. The monthly contribution before the relaxation is 15,536 yuan. After the relaxation, it is 17,478 yuan, more than 2,000 yuan a month.
Second, the risk of negative assets rises. In the 80% mortgage before the relaxation, the property price fell by 20%, and the property became a negative asset. Under the 90% mortgage, the property price fell by 10%, and it became a negative asset. Take the fine unit below 400 baht as an example. In the short period of 4 months from August to December last year, property prices fell by 9.6%. Of course, if the small owner can continue to contribute, the negative assets are only the book figures.
3 aspects of risk increase before entering the market
Thirdly, in the global economic slowdown, especially when the Mainland’s economic growth has not yet bottomed out, and the violent storm of Hong Kong’s anti-reforms, the Hong Kong economy is in recession and the unemployment rate is likely to rise, causing property prices to adjust. The wage earners are not without threats.
Whether the Hong Kong Government’s relaxation of the mortgage insurance ceiling will reignite the property market’s upward trend will still have to be observed. However, the decline in the threshold of the vehicle will undoubtedly accompany the rise in financial risks. The small public must understand the risks and assess their financial and risk tolerance before deciding whether to enter the market.