By WANG Tingting

Guangzhou, the capital city of Guangdong Province, announced on Wednesday that home buyers will enjoy preferential loans for first-home purchases, regardless of their previous credit record, a major easing of mortgage curbs, and the first first-tier city to do so.

A buyer who does not own a home in Guangzhou at the time of application can apply for housing credit as if it were the first property. The down payment ratio is down to 30 percent and the mortgage rate will be 4.3 percent, compared with 4.9 percent for second-home buyers. 

The market in Guangzhou has been declining since March. Around 3,500 new homes will be sold in August, a decrease of 40 percent compared to July, and down more than 50 percent year on year. That's the fewest since February 2020.

A number of cities have eased mortgage rules this year, including Hangzhou, Zhengzhou and Taiyuan. But at least 14 cities, including Beijing, Shanghai and Shenzhen are still sticking to strict policies. 

In Shanghai, the down payment ratio for home buyers who have already owned a property or applied for a mortgage in the past is 70 percent, and the mortgage rate is 5.25 percent. If Shanghai follows Guangzhou’s move, the down payment ratio could be reduced to 35 percent, with the interest rate down to 4.55 percent.