It’s not only Shenzhen’s stock market that is running hot. The Chinese city’s property market is also beginning to heat up, and it’s forcing some lenders to increase mortgage rates.
Reuters, citing a story in the Chinese Business Newspaper on Friday, reports some lenders in Shenzhen, including Bank of China, China Merchants Bank Co Ltd, Bank of Communications and China Construction Bank have increased mortgage rates for home buyers.
The move is in response to an explosion of activity in the city’s property market. In May new home sales soared by 50% while turnover of second-hand properties jumped by 28%.
In the year to April new home prices in Shenzhen increased by 0.7%. In comparison Shanghai and Beijing, other major tier one cities, recorded price declines of 4.7% and 3.2% respectively.
Chinese house price data for May will be released on June 18.