Hong Kong’s mortgage-related interbank offered rate fell for the sixth consecutive day by 36 basis points on Tuesday to 1.566 percent, as local liquidity continues to improve.
The continuous drop in the one-month Hibor brings down the real mortgage rate to 2.87 percent, marking a new low in more than two and a half years.
For a 30-year HK$5 million home loan, the homebuyers could pay HK$1,721 or 7.7 percent less compared with the cap of 3.5 percent set by major banks.
On Tuesday, the Hibor fell across all maturities.
This comes after the Hong Kong Monetary Authority stepped in four times earlier this month to ease the high demand for local currency, lifting the balance of the banking sector to HK$174 billion.
As the need for the Hong Kong dollar is expected to increase due to the dividend payment and new share sales, the Hibor may hover between 1 percent and 2 percent, if the balance could stay above the HK$100 billion bar, said local mortgage consultancy firm mReferral.
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