Tuesday, November 29, 2016
Mortgage Lending Continues, Say Banks
Mortgage loans are so hard to get in some cities in China that there are rumors that larger banks have suspended mortgage lending in those areas. The People’s Bank of China and other officials deny those rumors in reports published today. Bank lending has fallen, not just in mortgages but in most categories. Mortgages make up roughly half of all lending in China. Local governments have taken steps to reduce real estate speculation that has driven up property values above what most observers think are sustainable levels. A real estate bubble makes it harder for banks to finance real estate purchases, since the real estate itself may not serve as effective collateral for the loan.