Mortgages In China Tightened
China has tightened it’s Expat mortgage market affecting Expat’s ability to get loans
London, UK (Pryce Warner International) February 7th, 2012 – The National Development and Reform Commission has released new regulations that require foreign banks in China to comply with their medium and long-term debt quotas.
When explaining this the NDCR, China’s principal economic planner, stated that the funds in the quota should not be lent out as housing loans to Expats.
The NDCR also stated that Yuan backed loans of longer than one year originating from overseas jurisdictions need to be included in foreign banks’ medium to long term foreign debt quota, as they are seeking to strengthen the control of the quota.
This has prompted objections from bankers working in China as this may lead to a smaller availability of liquidity for Expats, including foreign workers from Hong Kong, Macau and Taiwan.
The head of a loan operator with a prominent foreign bank commented: “The new rules will largely affect foreign banks’ mortgage business as currently our major customers are expatriates.”
He went on to state that: “With fewer channels to finance the mortgage business for expatriates, we have to charge the higher interest rates to our customers to sustain profit and this might just put off some potential borrowers.”
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By Aneil Fatania
Financial Editor
Pryce Warner International Group
For any corrections of factual information contained within our news items please contact our editor.
Email: af@prycewarner.com
Skype: newsdesk-pwi
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