The actual interest rate is 2.475%, and the whole line of cash rebates are cut.
(By Ngan LunLok)
HSBC once again raised the mortgage rate and cut down the rebates after half a month. The bank announced yesterday, regardless of whether it is first-hand, second-hand and submortgage mortgages, the actual mortgage interest rate would be raised from 2.375% to 2.475%, which was a rate hike of 0.1%. At the same time, it also announced to cut down the cash rebate for property below HKD10 million to 1%, while for property above HKD10 million to 1.5%. That is, for every loan amount of HKD1 million, the cash rebate is HKD10,000-15,000. It is significantly lower than the cash rebate of about 2-2.05% previously.
Following the reduction of the rebate on the property of less than HKD3 million and the increase of the upper limit of submortgage interest on June 27, HSBC again announced yesterday to largely reduce the mortgage cash rebates and tighten the discounts of upper limit interest. The latest arrangement is the cash rebate for a loan of more than HKD10 million is 1.5% and for loan less than HKD10 million is 1%. At the same time, the bank has also raised the interest rate upper limit. Currently, it still provides a mortgage discount of H+1.24%, with the interest rate upper limit in P-2.75% (the actual mortgage interest rate is 2.375%), but it will be changed to P-2.65% later (the actual mortgage interest rate is 2.475%). The monthly installment payment of the loan of HKD1 million will increase by HKD50 after the interest rate hike of 0.1% (see attached table).
The Senior Vice President of mReferral Mortgage Brokerage Services, Cho TakMing believes, the recent social problems in Hong Kong and the Sino-US trade frictions may cause the bank to make decisions more cautious to manage any risks that may arise on the safe side, so decreasing the cash rebate to normalize the interest rates will be a healthier direction for the whole property mortgage market.
To improve the mortgage profit and the interest rate differential.
In fact, the cash rebates for property mortgage provided by Banks this year have been at a new high level in recent years, up to 2.1% of the loan amount, with the HIBOR (Hongkong InterBank Offered Rate) mortgage rate also down to the low level of H+1.23%, leading to high rebate and the interest rate has been at a low level for long term, so Banks hope to take the lead to improve mortgage profit and interest rate differential under the situation of low mortgage business profit.
Cho TakMing believes, this discount change will increase the discounts difference between banks, so it is believed that the mortgage schemes of the small and medium banks will be more attractive. However, there are still hidden concerns about the current market in Hong Kong, and it is not excluded that other banks will follow to adjust to strengthen the risk management, . As for the upper limit rate, in the case of the Fed's interest rate cuts and Hibor falling back to a low level, to maintain appropriate competitiveness and quality customers, Banks may not possible to make up regulation again in short term if the interest rate is still at a reasonable level.
The impact on actual installment is little.
The Managing Director of Centaline Mortgage, Wong MeiFung believes, the adjustment of mortgage rates and concessions by large banks is not a tightening of mortgages, and it is believed that Banks are still positive about the property mortgage market and it has little impact on the property market. The mortgage interest rate will generally remain at a low level of 2%, if the market risk does not increase significantly and the United States may cut interest rates again during the year,
The Chief Executive of the Midland Real Estate Residential Department, Bu Shaoming expresses, although there is bank slightly increasing the mortgage interest rate, but the impact on the actual installment is limited, and the low interest rate environment continues, so the interest rate changes will have no effect to the property market. On the contrary, due to the political and economic environment in the near future, the second-hand property market turns to wait and see, making buyers' attitudes into the market to be more cautious.
Bu Shaoming said, HSBC raised the Hibor mortgage rate upper limit by about 0.1%, but the monthly installment payment is only increased from HKD4,424 to HKD4,474 by about HKD50 if based on the mortgage amount of HKD1 million and the 25-year repayment period.
The monthly installment payment will increase by HKD250 if borrow HKD5 million.
The monthly installment payment will only increase by HKD250 if borrowing HKD5 million. Mortgage interest increasing this time has limited impact on installment payment, since there is stress test currently and the strength of prospective buyers has increased.
On the contrary, it is worth noting that the recent pace of developers' project launching has also slowed down due to the market sentiment. The large scale new project being launched in August is only Aurora in Tsuen Wan, which will be launched for the first time this Saturday, and the current application is ideal, showing there is still demand for the property in the market, also the payment methods for new property are relatively flexible, so it is expected that money will flow to the first-hand property market in the future and the situation will continue in the short term.
