Hong Kong’s government announced on June 25, 2023, that it will fine-tune mortgage limits for first-time homebuyers. The current rules allow borrowing up to 80% of the cost of a home priced HK$12 million or less.
For homes priced HK$10 million or less, the borrowing limit is 90% of the cost. The Hong Kong’s government plans to reduce the maximum loan-to-value (LTV) ratio for homes priced above HK$12 million and implement measures to cool the property market.
Hong Kong’s property market has experienced significant growth in recent years. Home prices have risen by over 50% in the past five years, making it harder for first-time buyers to afford a home.
The government aims to curb this trend by reducing the maximum LTV ratio, making it more challenging for buyers to borrow money and potentially lowering home prices.
Aside from adjusting mortgage limits, the government is exploring other measures to cool the property market.
These include considering a stamp duty surcharge for non-resident buyers and tightening lending criteria for property investors.
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