Local mortgage rate floors allowed to be adjusted

China has announced the establishment of a mechanism that allows local governments to adjust the regulatory floor of mortgage rates upon changes in local home prices, as part of its stepped-up efforts to promote a steady and healthy development of the property market.

Under the mechanism, cities where new home prices fall for three months in a row on both the monthly and yearly basis are allowed to temporarily maintain, lower or cancel the local lower limit of mortgage rates for first-home buyers, the People's Bank of China and the China Banking and Insurance Regulatory Commission said in a joint statement on Thursday.