Down payment for 2nd homes hits 70%

Beijing raised the minimum down payment for second homes in the city to 70 percent from the original 60 percent starting Monday.

The policy applies to both commercial and housing accumulation fund loans, in a bid to rein in the overheated property market.

Buyers without property ownership records in the municipal property transaction information system are eligible for the down-payment ratio of 60 percent, even if they are found to have records of borrowing a home loan or withdrawing money from the housing accumulation fund, according to an announcement issued by the municipal housing accumulation fund center on April 7.

Mortgage rates will remain at 1.1 times the benchmark one-year lending interest rate.

The 60 percent ratio is also applicable to commercial loan borrowers who have no property ownership records but are found to have a preexisting home loan.

It’s said that commercial banks' mortgage rates for second-home buyers is not likely to be lower than 1.1 times the benchmark interest rate, according to media reports.

The municipal housing accumulation fund center also requires buyers with an average monthly income three times the city’s urban employee average or more should pay mortgage loans at a ratio of no less than 50 percent of their monthly income.

The city said in late March that single individuals will not be allowed to buy a second home, and pledged to implement a 20 percent capital-gain tax on property sales.

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