Developers, estate agents and banks offer mortgage payment sweeteners to sustain market sentiment
Developers and property agents worried that rising interest rates will dampen buyer enthusiasm have teamed up with banks to offer mortgage sweeteners.
They stepped in yesterday ahead of an expected 25-basis-point rise in the United States federal funds rate, which Hong Kong banks are expected to follow.
Hong Kong banks raised their prime rates with effect from Monday as local firms braced themselves for more aggressive rises.
Despite the Hong Kong dollar's peg to the greenback, excessive liquidity in the banking system has spared Hong Kong the worst of recent US rate rises. But the tide has turned over recent months as net fund flows recede, putting increased pressure on Hong Kong banks to raise rates.
Kerry Properties has joined HSBC to offer a mortgage plan that exempts repayment of interest and monthly instalments in the first year for buyers of the remaining 12 flats in its Tsuen Wan project, the Cliveden.