Zhongyuan Mortgage: Lifting the mortgage restrictions will help the market recover and boost market confidence.

On February 28th, Wang Meifeng, the Managing Director of Central Mortgage, stated that the Hong Kong government's active response to mainstream voices and decisive implementation of revoking property market control measures will help restore the confidence of potential buyers and accelerate their home buying decisions. This move will also benefit the diversified development of the property market, attracting potential buyers with different needs to enter the market, and is expected to bring new vitality to the sluggish property market and mortgage market, returning transaction and loan volumes to normal levels, while restoring the health of the property market circulation. At the same time, this direction aligns with the government's efforts to attract funds, enterprises, and talents. Wang Meifeng pointed out that the new financial plan and relaxed mortgage policies will lower the threshold for different housing needs and homebuyers, making the property market more flexible and resilient. Although homebuyers with existing property mortgages are still subject to restrictions on second home mortgages, the higher stamp duty on new residential properties has been abolished, and the loan-to-value ratio has been further relaxed to nearly restore the 70% mortgage limit. This will help the recovery of the property market, boost market confidence, and restore the flexible development of the property market. Wang Meifeng believes that the purpose of stress testing is to enhance the resilience of homebuyers during the period of interest rate hikes. Considering that the interest rate hike period has already peaked, future trends will gradually return to medium to long-term levels, and it is appropriate to suspend the implementation of stress tests now. After loosening restrictions, mortgage borrowers will only need to meet the existing maximum income requirement for installment payments, with the current monthly installment payment to income ratio not exceeding 50% (for first-time homebuyers and owner-occupied property mortgages).