Ten-million-dollar mortgages and higher interest rates have become the new normal in the housing market

The national average mortgage loan amount reached 10.811 million yuan in the second quarter, setting a new high. (Photo by reporter Xu Yiping)

[Reporter Xu Yiping/Reported from Taipei] Home buying has hit three new highs. According to the latest release from the Lianzheng Center, the national average mortgage loan amount reached 10.811 million yuan in the second quarter, a record high. The average mortgage interest rate in the same quarter was about 2.43%, also a record high since the financial tsunami. At a relatively high point, coupled with the fact that bank house appraisals have exceeded 15 million yuan for two consecutive quarters, real estate industry players point out that multi-million dollar mortgages and high interest rates are the current situation in the housing market. This is followed by continued sluggish buying sentiment, with the number of new mortgage loans falling below 40,000 for six consecutive quarters.

According to the mortgage data from the Lianzheng Center, the peak of housing market purchases in the past 10 years occurred in the second quarter of 2024, with 65,000 people in a single quarter. However, the housing market has cooled down rationally since the seventh wave of restrictions. In the second quarter of this year, there were only 38,000 new mortgage loans, which was less than 60% of the peak.

Zeng Jingde, project manager of the Xinyi Housing Real Estate Enterprise Research Office, said that according to the data released by the Lianzheng Center in the second quarter, it reflects that multi-million-dollar mortgages and average mortgage interest rates of more than 2.4% have become the new normal. The difficulty of applying for mortgages for home buyers may change with market capital conditions, and they may face difficulties such as difficulty in finding or higher interest rates.

The buying momentum in the real estate market is only limited to the basic market

Moreover, since the seventh wave of restrictions, the number of mortgages has remained within 40,000 for six consecutive quarters, reflecting that market transactions have returned to calmness, and owner-occupiers are still dominant. With basic support from self-occupancy buying and the wave of housing handovers still maintained, the number of mortgages in a single quarter has remained at more than 30,000, but the loan amount has not declined accordingly. Mortgages in the tens of millions have become the norm, and the capital cost of mortgages has also risen to more than 2.4%.

Zeng Jingde said that it was not difficult to obtain real estate prices in the era of loose funds. At that time, there was a lot of money in the market and there was business competition among banks, and they were willing to provide better conditions to win customers. However, now funds are tighter, and with the booming development of AI, the amount of corporate joint loans is considerable. Stock market transactions often exceed trillions of dollars, and funds are needed. The cost of banks absorbing funds from the public has also increased, so it is not as easy as before for people to apply for mortgages.