New mortgage lending fell in September, according to the HKMA's monthly survey of residential mortgage lending.
The amount of gross new loans made in September decreased by 25.3% to HK$8.6 billion after rising by 13.9% in August. The average size of new loans decreased to HK$1.35 million in September from HK$1.40 million in August.
New loans approved during the month fell further by 5.8% to HK$10 billion compared with a decline of 19.2% in August, largely driven by continued decline in loan approvals in the primary market and refinancing loans. Refinancing loans fell in absolute terms for the fourth consecutive month, and accounted for 25.7% of new loans approved in September, down from the ratio of 29.4% in August. Loans approved during the month but not yet drawn increased by 3.1% to HK$7.5 billion in September from HK$7.3 billion in August.
The average loan-to-value ratio of new loans approved remained unchanged at 59.1% in September. The average contractual life shortened marginally to 204 months from 205 months in August. 99.0% of loans were related to owner-occupied properties.
On the pricing front, loans granted at below the best lending rate for the whole term of the mortgage accounted for 89.2% of the new loans approved, compared with 88.4% in August. Loans granted at more than 2% below the best lending rate represented 55.7% of the new loans approved.
The amount of outstanding mortgage loans edged down by 0.1% in September. The 3-month moving average growth rate (annualised) of outstanding loans decreased to 1.2% from 1.4% in the 3 months to August. The 12-month moving average growth rate also decreased, to 0.7% from 0.8% in August.
The loan delinquency ratio (measured by the ratio of mortgage loans overdue for more than 3 months to total outstanding mortgage loans) increased to 1.28% in September from 1.26% in August.
"New mortgage lending dipped in September to the lowest level this year," said Mr David Carse, Deputy Chief Executive of the HKMA. "This was due primarily to the decline in loans to finance purchases in the primary market and refinancing loans. Approvals of loans to finance purchases in the secondary market, on the other hand, have shown a steady increase over the last couple of months."
Gross loans made for the purchase of properties in Mainland China reduced by 93.8% to HK$23 million in September from HK$365 million in August. The amount of outstanding loans decreased by HK$163 million to HK$6.2 billion.
For further enquiries, please contact:
Thomas Chan, Senior Manager (Press), at 2878 1480 or
Caitlin Wong, Manager (Press), at 2878 1687
Hong Kong Monetary Authority
30 October 2000
Annex
Notes to Annex
- Residential mortgage loans in the survey refer to loans (which include refinancing loans) to private individuals for the purchase of residential properties, including uncompleted flats, but excluding flats in the Home Ownership Scheme, Private Sector Participation Scheme and Tenants Purchase Scheme. Mortgage loans to corporate clients are excluded from the survey.
- Gross new loans made refer to mortgage loans which are actually drawn down during the month.
- New loans approved refer to mortgage loans which are approved during the month. The loans can either be drawn down in the same month or in the following months. The loans which are approved but not yet drawn down are shown under the item "New loans approved during month but not yet drawn". This figure will have implications for the amount of gross new loans made in the following months.
- Mortgage loans are classified as overdue when an instalment payment is overdue for more than 3 months and remains unpaid at the last day of the reporting month. The delinquency ratio is the weighted average of the ratio of the total amount of overdue loans over the total outstanding mortgage loans.
- Co-financing schemes refer to those schemes which involve the provision of top-up loans by the property developer (or other co-financiers) in addition to the mortgage loans granted by banks. Only the portion of loans granted by banks are reported in the survey.
- Average loan-to-value ratio, average contractual life and owner-occupied properties are all weighted average figures, which are weighted by the amount of new loans approved during month by individual banks.
