China Moves to Ease Property Financing in Hopes of Boosting Sector — Update

Chinese regulators Friday unveiled a broad package of measures to ease property financing, as the housing downturn continues to weigh on economic growth.

Under these new rules, Chinese homeowners will be able to refinance their high-rate existing mortgages by negotiating directly with banks or securing new lower-rate loans to replace them.

The lack of a formal refinancing system led many homeowners to use short-term consumer loans and other credit lines to prepay their mortgages, following the central bank's benchmark rate cuts aimed at reviving economic growth and the sluggish property market.

New homebuyers will also be allowed to secure mortgages of up to 40 years--up from the previous 30-year cap--under new rules released by China's central bank and other financial regulators.

Commercial banks are also being encouraged to offer operating commercial property mortgages with terms of up to 15 years to help revive slumping sales.

China's real estate sector has become the primary drag on the world's second-largest economy after Beijing imposed strict borrowing limits on developers to curb spiraling debt overhang.

Under the latest rules, Beijing eased capital-market financing for the country's property developers, letting them use shares and convertible bonds to acquire property assets.

The rules also made it easier for developers to obtain longer-term bank loans, with repayments generally deferred until after projects are completed.

But the new regulations also tightened oversight for urban renewal projects, barring lenders from issuing such loans for borrowers to pay land-transfer fees, pre-development costs or other expenditures that should be covered by fiscal funds.

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(END) Dow Jones Newswires

August 28, 2026 08:54 ET (12:54 GMT)