China to implement mortgage interest subsidies from Oct 1

BEIJING -- China will implement interest subsidies for housing loans starting Oct 1, 2026, with a tentative implementation period of one year.

During this period, for eligible first-time homebuyers, the fiscal authorities will provide an annualized subsidy of 1 percentage point, according to a notice jointly issued by the Ministry of Finance, the People's Bank of China and the National Financial Regulatory Administration on Tuesday.

This is the first time the central government has offered interest subsidies on commercial housing loans.

This interest subsidy policy is focused on first-time homebuyers. The floor area of each purchased unit must not exceed 120 square meters, and the purchase price must not surpass 1.5 million yuan (about $222,516).

Under this policy, the maximum amount of interest-subsidized loans can reach 1 million yuan, and the subsidy period can extend up to five years.

According to estimates, for a long-term 1-million-yuan commercial personal mortgage, the subsidies could help borrowers reduce cumulative interest payments by nearly 50,000 yuan.

By defining housing price, floor area and loan category, the policy aims to precisely benefit target groups and help lower-income families reduce their monthly mortgage burdens, the departments said.

The policy focuses on first-time buyers with essential needs, supporting families in purchasing small and medium-sized, and relatively low-priced homes, according to the departments.