China changes mortgage rates anchor to curb housing risks

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china-buildings

The PBoC is looking to curb real estate speculation

China’s authorities will change the anchor for mortgage rates to the new loan prime rate (LPR) starting from early October, a move seen as aiming to curb housing risks and clamp down on property speculation.

Banks will set mortgage loans based on the LPR, effective from October 8, the People’s Bank of China (PBoC) said in a statement on August 25.

The announcement came around a week after the central bank reformed the rates mechanism to cut funding costs as economic growth slows. The new



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