Market Trends of China Mortgage/Loan Brokers Industry
Change in Monetary factors affecting China Mortgage/Loan Brokers market.
China has continuously declined its base rate, with the current rate standing at 3.650%. As interest rate plays a major role in economic activities, an increase in interest signifies a trend of increase in inflation. In contrast, a reduction in interest signifies accommodative policies of banks and financial institutions for increasing economic activities and investments. With a decline in interest rate, mortgage loans play a major role when there is no collateral. Therefore, a decline in interest rates will allow the people of China to access a loan without any collateral.
Other than this, an increase in land and real estate prices makes, lending agencies assured of being able to recover in case of a default. Real estate had observed a continuous increase in sales prices in China, creating a positive outlook for borrowers and loan-issuing agencies for mortgage loans.
Banking Penetration affecting Loan Mortgage Real estate market.
As a developed nation and an economic hub globally, China connected almost 80% of its population to banking facilities, making it easier for them to deposit and credit money. With a continuous increase in mobile internet users, all the banking facilities are available on mobile through which people can apply for mortgage loans, and banks can make their facilities available to customers without making them arrive in person.
For state-owned commercial banks, the total loan amount had continuously increased, rising to 103 trillion Yuan (14.56 USD trillion) last year. With all these increases in banking penetration, a negative effect is also been observed with an increasing Non-performing loans, making banks take a precautionary approach while lending.
