Chinese Homeowners Applaud Beijing’s Mortgage Rate Cut, Yet Skepticism Lingers Over Potential Recovery

Owners of homes in China are celebrating Beijing's decision to reduce mortgage rates by half a point. However, some are skeptical that this action will not trigger a revival.

China announced its rescue plan for the struggling real estate industry on Tuesday. The plan includes reducing the mortgage rate and decreasing the initial payment required for second homes from 25 per cent to 15 per cent.

Property owners in China expressed their approval of the measures taken by the nation's central bank.

"Early repayment of my home loans is no longer a concern for me," stated Jessie Deng, a finance expert at a building company. She purchased her house in Guangzhou in 2021, at which time the yearly loan interest rate was at 5.3 per cent. She had to make monthly payments exceeding 10,000 yuan, an amount equivalent to an average worker's monthly wage in the city.