The property market remained subdued in December 2000, according to the HKMA's monthly survey of residential mortgage lending.
The amount of gross new loans made in December decreased by 38.1% to HK$5.9 billion. The average size of new loans decreased to HK$1.29 million from HK$1.42 million in November.
New loans approved continued to fall, by 26.4% to HK$5.8 billion after the decline of 28.0% in November. The share of new loans approved accounted for by refinancing loans dropped to 35.4% from 39.3%. Loans approved during the month but not yet drawn decreased by 14.4% to HK$3.9 billion from HK$4.6 billion in November.
The average loan-to-value ratio of new loans approved decreased to 59.6% from 62.4% in November. The average contractual life shortened to 201 months from 204 months. 98.6% of loans were related to owner-occupied properties.
On the pricing front, loans granted at below the best lending rate for the whole mortgage term accounted for 87.1% of new loans approved, compared with 90.5% in November. Loans granted at more than 2% below the best lending rate represented 62.8% of new loans approved, up from 60.6% in November.
The amount of outstanding mortgage loans fell by 0.4% in December. The 12-month growth rate decreased to 0.8% from 1.3% in November.
The loan delinquency ratio (measured by the ratio of mortgage loans overdue for more than 3 months to total outstanding mortgage loans) dropped to 1.26% from 1.31% in December.
"While the fall in the delinquency ratio was largely due to write-offs made by some banks before the year-end, there also appeared to be a slow-down in the increase of overdue loans" said Mr. David Carse, Deputy Chief Executive of the HKMA. "However, whether this improvement will be maintained in the coming months remains to be seen."
Gross loans made for the purchase of properties in Mainland China increased to HK$51 million from HK$45 million in November. The amount of outstanding loans decreased further by HK$110 million to HK$6.0 billion in December.
Hong Kong Monetary Authority
29 January 2001
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.
