HKMA relaxes mortgage loan measures on non-residential properties

The adjustment takes effect from 20 August.

The Hong Kong Monetary Authority (HKMA) has eased the measures for mortgage loans on non-residential properties, adjusting the applicable loan-to-value ratio caps from 40% to 50% for general cases, a press release revealed.

The adjustment takes effect from 20 August.

“It is considered positive when it comes to boosting investment demand and should help to lift transaction volume, subject to the local economy if it shows signs of stabilisation,” commented Marcos Chan, head of research of the Greater Bay Area and Hong Kong at CBRE.

“Taking into account factors such as the price trends of non-residential properties, transaction volumes, economic fundamentals, and the external environment, the HKMA considers it appropriate to adjust the countercyclical macroprudential measures on non-residential properties,” said Eddie Yue, chief executive at the HKMA.

The HKMA also reiterated in its circular to banks today that its countercyclical macroprudential measures are intended to apply to mortgage loans for the purpose of financing property transactions or the refinancing of existing properties.

“Rental and mortgage affordability remains the biggest concern for some owner occupiers if their business outlook remains cloudy. Any bank measures that could help to ease property owners’ mortgage burden will be welcomed by property owners and investors,” Chan added.