Hong Kong banks offer mortgage rebates as rate cuts seen igniting housing market rebound
Some lenders are offering cash rebates on mortgage financing, igniting competition for homebuyers in anticipation of a pickup in transactions
Some lenders are offering 0.1 per cent to 0.25 per cent discount to prospective borrowers, depending on the loan amount and their creditworthiness, according to Centaline Mortgage Broker. Bank of China (Hong Kong) and Standard Chartered are among them, local media reports showed.
“Raising the rebates to attract homebuyers reflects the positive attitude of banks” on the property market outlook, managing director Ivy Wong Mei-fung said. “Other banks are likely to follow suit.”
Lenders have been cautious in writing new home loans as the Covid-19 pandemic hit households. The city’s market-boosting measures in February, the biggest in decades, have since worn off as prices weakened. The imminent rate-cut has spurred banks to shed their cautious stance and “normalise” the approval process on mortgage applications, she added.
“The market expects the Fed to announce a rate cut later this month,” said Eric Tso Tak-ming, chief vice-president of mortgage broker mReferral in Hong Kong. “Hong Kong’s Hibor rates could follow suit, which will ease the pressure on banks’ mortgage funding costs.”
