Housing mortgage loan rates raised
(Xinhua)
Updated: 2006-04-30 09:05
China's Public Housing Fund (PHF) has raised mortgage
rates for individual house buyers by 0.18 basis points effective from May 8.
The annual interest
rate for loans with a maturity of five years or less will rise 3.96 percent to
4.14 percent, the Ministry of Construction, the supervisor of PHF, said on its
website Saturday.
Mortgage loans with a maturity of more than five years
will now carry an annual interest rate of 4.59 percent up from 4.41
percent.
A day earlier, China's central bank raised the benchmark lending
rate for one-year loans by 0.27 basis points from 5.58 percent to 5.85
percent.
The rate for deposits remains unchanged.
The PHF was
established in the 1990s following the reform of the housing system in
China.
The PHF was designed to help medium- and low-income earners to buy
houses. Employees are required to contribute 5 to 12 percent of their salaries
to the fund, with their employers contributing the same amount. PHF mortgage
loans carry lower rates than commercial mortgages.
The lending rate hike
by the central bank is aimed at preventing the economy from overheating, in
response to rapid expansion of loans and fixed-asset investment in the first
quarter.
Central bank officials said they hope the hike will help stop
housing prices in major Chinese cities from soaring further.
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