, January 1 (Zhongxin Financial Reporter Zuo Yukun) At the beginning of the new year, many loan buyers can see a good news after opening the bank APP - the mortgage interest rate will be reduced by another 3 basis points (BP).

"The interest rate has dropped a little bit, and I can save money for a cup of milk tea in January." After receiving the first "red envelope" of the new year, looking forward to the trend of LPR (loan prime rate) and mortgage interest rates in 2024, many industry insiders believe that there may still be room for further downside.

Data map: Bank staff count money. Photo by China News Service reporter Zhang Yun

Mortgage rates were cut by another 10 basis points on the repricing date

"Dear customer: Due to the adjustment of the benchmark interest rate of the People's Bank of China, according to the loan contract, from 20240101, the annual interest rate (simple interest) of the personal first-hand mortgage loan with the end number of your contract xxxx will be adjusted to 4%, and the next repayment amount will be xxxx yuan. You can contact the branch or log in to mobile banking to get the latest repayment schedule, thank you for your support! ”

There may be many buyers who receive the first text message in the new year, which is good news from their own loan bank. Ms. Hu is one of them, and after the adjustment, her mortgage interest rate has been reduced from 4.1% to 4%, and according to her own situation with a total loan of about 70,20 yuan and a term of 20 years, Ms. Hu can pay about <> yuan less per month after this adjustment.

In 2023, there has been a large-scale reduction in existing housing loans. According to the Notice on Matters Concerning the Reduction of Interest Rates on the First Housing Loan of the Stock of the Stock issued by the People's Bank of China and the State Administration of Financial Regulation, starting from September 2023, 9, borrowers of commercial personal housing loans for the first housing in stock can apply to the lending financial institution, and the financial institution will issue a new loan to replace the commercial personal housing loan for the first housing in stock.

According to the data disclosed by the central bank and the State Administration of Financial Regulation, as of the end of September 2023, the interest rate on more than 9 trillion yuan of existing housing loans has been reduced, with an average reduction of 22.0 percentage points, benefiting 73 million people and reducing borrowers' interest expenses by 1 billion to 5 billion yuan per year.

The above-mentioned reduction in the interest rate of existing mortgages in 2023 is mainly carried out by reducing the basis point; The interest rate of the existing mortgage at the beginning of 2024 will be reduced by another 10 basis points, which is for the LPR.

It is understood that the calculation of the mortgage interest rate is composed of LPR plus basis points. When the mortgage repricing date comes, the bank will automatically adjust the personal mortgage interest rate for the new year according to the rise and fall of the LPR in the previous year. In 2023, the LPR for more than 5 years will be reduced by 4 basis points from 3.4% to 2.10%, and the mortgage rate will also be reduced by 1 basis points for mortgage customers who choose January 1 as the repricing date.

It is worth noting that the so-called repricing date refers to the date on which the borrower of a floating rate loan agrees with the bank on the interest rate adjustment, of which the repricing date of the personal mortgage is January 1 of each year, or the date corresponding to the loan disbursement date every year, with the former being the majority.

Data map: Buyers are viewing and understanding the real estate. Photo by China News Service reporter Liu Zhongjun

In the future, the LPR may still decline moderately

Also in the past New Year's Day holiday, data from the China Index Research Institute showed that during the 2024 New Year's Day holiday (2023.12.30-2024.1.1), the average daily transaction area of 40 representative cities decreased by more than two percent compared with the New Year's Day holiday of the previous year (2022.12.31-2023.1.2). In addition to the good performance of individual projects, the performance of the property market in many places is relatively flat, and the differentiation has intensified.

In the short term, the pressure of real estate market adjustment is still there, and the deposit rate in December has ushered in a new round of concentrated reduction after three months, and many industry insiders believe that there is still room for downward mortgage interest rates in the future.

Wen Bin, chief economist of Minsheng Bank, believes that the Central Economic Work Conference proposed to "promote the steady and moderate decline of social comprehensive financing costs", which means that in 2024, the central bank will most likely still guide the LPR to decline moderately, thereby promoting the steady decline of financing costs and activating the demand for production and consumer credit. However, combined with the central bank's previous proposal to maintain bank interest margins and profits at a reasonable level, the further downside of LPR and new loan interest rates will be narrowed.

Dong Ximiao, chief researcher of Zhaolian, believes that there is still room for LPR to decline in 2024, and there should be a decline of 10-15 basis points. On the one hand, in 2023, the deposit interest rate will be lowered several times, and the cost of liabilities of banks will be reduced. On the other hand, in 2024, the central bank is likely to cut the reserve requirement ratio and open market operations, and the policy rate will likely fall, which will help reduce the cost of funds for banks.

"Residents are sensitive to the cost of buying a house, and it is expected that 'cost reduction' measures will be increased in 2024 to improve the consistency of macro policies and micro feelings, the most important of which is to reduce mortgage interest rates." Li Yujia, chief researcher of the Guangdong Provincial Housing Policy Research Center, also mentioned that as housing prices continue to adjust in various places, cities with no lower limit on the mortgage interest rate for the first home will increase significantly, and the actual mortgage interest rate may fall more than the LPR.

For example, a few days ago, Dongguan, Guangdong Province announced that from January 2024, 1, the lower limit of the interest rate on the first home loan will be cancelled in stages, and the specific interest rate will be determined by each bank according to marketization and legalization. This means that the existing lower limit of the first home loan interest rate in Dongguan, LPR-1BP, will break through the limit of 20BP, and there is no lower limit. (ENDS)