Hong Kong mortgage loans hit 12-month high of US$3.4 billion as low rates lure refinancers
Refinancing loans drive the increase, rising 33.7 per cent to HK$3 billion, the Hong Kong Monetary Authority says
Banks approved HK$26.6 billion (US$3.39 billion) worth of loans in May, a 5.3 per cent rise from a month earlier, according to official data on Monday. It was the highest total since May last year when lenders extended about HK$31.6 billion in loans, according to data compiled by agents.
The increase came from approved mortgage loans for refinancing, which climbed 33.7 per cent to HK$3 billion. Mortgage loans for new and lived-in homes declined by 4.2 per cent to HK$8.9 billion and 7.1 per cent to HK$14.6 billion, respectively, according to the HKMA.
Meanwhile, mortgage loan applications rose 5 per cent to 8,187 in May from April, the highest since March’s 8,456 applications.
“Interest rates have dropped significantly, and large developers continued to launch low-priced properties to attract first-time buyers and investors to enter the market, boosting the overall market sentiment,” said Eric Tso Tak-ming, chief vice-president of mortgage broker mReferral. “The real estate market will continue to stabilise and will drive the number of residential mortgages to rise further.”
The proportion of new mortgage loans priced with reference to Hibor increased to 93.4 per cent in May from 91.8 per cent in April, the HKMA said.