Recently, mortgage lenders in Beijing have generally raised the mortgage rate by 10 percent for first-time homebuyers, which has raised public concerns.
However, prior to the move the practice had already been adopted by their Shenzhen counterparts, with some local banks even raising the rate by 15 or 20 percent, according to the Shenzhen Economic Daily.
The reporter from the newspaper found that before the Spring Festival a number of local banks, including four State-owned banks, had already increased their mortgage rates by 10 percent.
At present, all local banks have raised their rates for first-time homebuyers by at least 10 percent, according to statistics provided by financial services company Rong360 last week.
Although housing prices in Shenzhen have continued to fall for 19 months, the cost of buying an apartment has actually gone up for first-timers.
For instance, to get a mortgage loan of 1 million yuan (US$157,840) with a term of 30 years first-timers now have to fork out 265,000 yuan to pay the total interest since the rate increase.
“Homebuyers with incomes lower than the city’s average can consider the rental housing and affordable housing market. We believe the housing policy in Shenzhen will maintain the status quo in the near future,” said Xu Feng, research director of the Shenzhen Real Estate Intermediary Association.
According to mortgage analyst from Rong360 Zhang Qi, although the current interest rate has tightened the overall trend is still on a steady rise. With the influx of migrants, Shenzhen will continue to see an imbalance between supply and demand in the property market, said Zhang.