HSBC and BOC locked rates at 1.68% - lower than the industry standard.
Bloomberg reports that two of the city’s largest mortgage banks are locking their mortgage rates to attract entrants into the world’s least affordable housing market amidst warnings from the de-facto central bank Hong Kong Monetary Authority that rates may rise faster than expected as the Fed tightens its monetary policy.
HSBC Holdings PLc and BOC Hong Kong (Holdings) Ltd have fixed their interest rate at 1.68% for the first year of the loan which is considerably lower than the 2.15% rate that currently prevails in the industry, according to data from Centaline Mortgage Broker Ltd.
Hang Seng Bank also launched a one-year fixed mortgage rate of 1.68% per annum for primary and secondary residential properties and refinancing mortgages. Subsequent mortgage rates will be the HIBOR plus 1.3% per annum, capped at prime rate minus 2.85% per annum.
The three banks account for a lion’s share of the the city’s mortgage market to post a combined market share of about 61% in terms of loans extended for finished apartments last year.
“The mortgage business is a battlefield. Banks are starting this to win market share as customers are foreseeing higher interest rates,” Andrew Chui, head of the personal loan business at Industrial & Commercial Bank of China (Asia) Ltd.
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