Banks on mortgage rate hike bandwagonBusiness | Samantha Wong 29 May 2017
Bank of East Asia and Hang Seng Bank have joined several major banks - HSBC, Standard Chartered and Bank of China (Hong Kong) - to raise mortgage rates by 10 basis points to HIBOR plus 1.4 percent, following the Hong Kong Monetary Authority's move to tighten mortgage borrowing rules to reduce risks.
The new rates at HSBC and Standard Chartered are to take effect today, while Bank of East Asia, Bank of China (Hong Kong) and Hang Seng said their moves are effective on June 5.
"We will continue to work within the enhanced? regulatory guidelines to ensure that our mortgage lending continues to be prudently managed," HSBC said in a statement.
Over the past two weeks, the authority has released various measures on lending to developers and property mortgage loans in response to an overheating housing market.
However, given the increased difficulty in obtaining mortgage financing, buyers continued to prefer property in the primary market, where financing options and other incentives are being offered.
"The market will still remain supported by strong pent-up demand, largely from first-time buyers," JLL said in a report.
It is estimated that 90 percent of all transactions in recent months have been made by first-time buyers, suggesting that the measures are unlikely to have any effect on market dynamics.
Separately, K&K Property said it sold 258 out of 307 flats at its Kai Tak project Victoria Skye, while Cheung Kong Property (1113) will put on sale 346 flats from its Tsuen Wan West project Ocean Pride on Wednesday.
Meanwhile, the Sales of First-hand Residential Properties Authority and the Estate Agents Authority conducted a joint inspection at the sales office of a first-hand residential development.
Officers inspected the sales procedures and checked if the vendor had acted in compliance with the requirements of the ordinance. It also distributed "Notes to Purchasers of First-hand Residential Properties" to enhance the transparency and fairness of the sales of the properties.
In the secondary market, Centaline Property recorded four transactions over the weekend at the 10 major housing estates that it tracks. The number marked a 33.3 percent drop from six transactions the previous weekend. All of the four deals were made in Kingswood Villas in Tin Shui Wai.
Midland Realty reported seven deals over the weekend, with no transactions recorded in seven major housing estates. Midland said the launch of new projects recently has diverted some purchasing power from the secondary market to the primary market.