The banking regulator yesterday issued new rules to help
low-cost housing developers get loans and encourage
construction.
"Providing low-income families with affordable apartments has
been a priority for the government and we are offering financial
support accordingly," said the China Banking Regulatory Commission
(CBRC).
Under the new rules, banks can give loans for low-cost housing
if developers raise 30 percent of the total capital. That compares
with the 35 percent required for commercial housing developers.
Banks can also offer economy housing developers low interest at
90 percent of the benchmark lending rate, which is currently at
7.47 percent a year, the regulator said.
The central bank also expanded its list of loan providers for
this category from just State-owned banks to all financial
institutions, including joint-stock banks.
The new rules are expected to boost property developers and will
take effect 30 days from Jan 18.
Commercial banks had loaned 50.9 billion yuan to affordable
housing projects by the end of last year, the regulator said.
Investment in low-cost housing rose 30.5 percent in the first
nine months of 2007 from a year earlier, and spending on the
segment accounted for 4.4 percent of the country's total investment
in the property sector, according to the central bank's latest
quarterly monetary policy report.
Government leaders urged faster construction of low-cost housing
for urban families at the Central Economic Work Conference last
year. Premier Wen Jiabao said earlier that budget
accommodation construction would be an important measure to
evaluate local government performance.
By the end of June 2007, 586 of the country's 656 cities had set
up subsidized housing for sale and rental, the CBRC said.
But China's sizzling property market shows little sign of
cooling down. Property prices in China's 70 large and medium cities
jumped by 10.2 percent in the fourth quarter from a year earlier,
according to the National Development and Reform Commission.
(China Daily February 5, 2008)
