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Floating mortgage rate is not conducive to market regulation

housing prices should not just housing prices, housing prices and mortgage interest should be considered. If the loan interest rate rise than the House prices drop more, for those most in need to purchase the first mortgage, this control must be adjusted.  

since October this year, "House" (forward to first home buyers fall in house prices) are all anxious. First Beijing, CCB announced on October 14 floating mortgage rate 5% per cent or higher, just ten days are Shanghai, Guangzhou, Shenzhen, Chengdu, Tianjin, Jinan, Qingdao, Zhengzhou, Wuhan, Changsha and other 14 city banks announced that rising mortgage interest rates, floating range from 5% to 10%. Guangzhou banks mortgage rates is "a week", first home loan rates up-30% up to 20%.

the need for housing? Of course is to solve the housing problem of the people. "China cut rates is a national firm policy, adjusted house prices will enable the public to accept, also make the healthy and orderly development of the real estate industry. Real estate a series of control measures, must not have the slightest wavering, our goal is to get prices back to reasonable prices. As a large developing country, we are going to run their own affairs well, and is a contribution to the world's largest. "Premier Wen Jiabao recently attended in Russia Saint Petersburg, the Member States of the Shanghai Cooperation Organization to be held at the tenth meeting of the Prime Minister said in his speech, is the official real estate regulation in China these days most clear position, but also for real estate to relax before the debate ended. "Implement differentiated housing credit policy and strict restrictions of all kinds of real estate and speculative buying", which was written into the relevant market regulation of the State the contents of the file. However, the fall in practice, implementation of sector specific measures to release even the rigid demand for combat.

rising mortgage interest rates, all parties expressed their views. Ministry of housing told reporters: "the raising interest rates was not market macro-regulation at the national level, but the banks themselves. "Experts to defend banks:" the present trend of falling prices, high risk mortgage banks based on risk adjusted interest rates, rising mortgage interest rates reasonable. "Why can't raise mortgage interest rates? Banks have a responsibility not to protect the interests of the rigid demand it? No. Banks are commercial institutions, not serve the economic strategy of policy banks, but mainly at profit goals. Judge real estate risk in commercial banks increased by increasing the rate of access to risk premium is a normal thing to do. ”

these plausible views can be summed up in two points: first, the floating mortgage rates is the Bank Act, the banks are commercial institutions, a float of autonomy and, secondly, it is the need of banking risks.

However, China's banks are truly independent from those of the commercial institutions? When it is not government policy services? In October 2008, served as the real estate industry to weather the financial crisis, the first mortgage "down payment down to 20% and 70 percent rate" fell out. 2010 to curb housing prices, tighter loan policy was given responsibility. This has not been written into the relevant government departments as a bank's own files. Determine rates based on risk, Yes, but high risk personal loans? Regional financial reports issued by the Central Bank of China in 2009, according to the 2009 National individual housing loan rate at the end of 0.6%, 1/3 of China's commercial banks ' average bad loan ratio was not, well below recent CBRC allowed 5% SME tolerance of bad loans. Why good property of individual housing loans, but also to guard against risks in the name of rising mortgage interest rates? People's livelihood is not hanging on the mouth but in reality. The Bank's social responsibility lie?

banks defend themselves: individual housing loan profit margins are very low, there is no "mortgage profits." Seems to feel aggrieved. If so, please? Although the banks non-profits (it shouldn't have profiteering), but still very impressive. According to statistics, listed companies in the first half of 2011 's top ten money-making machines banks occupy seven seats. Average earnings per share of listed companies in Shenzhen and Shanghai in the first half 0.285, 16 banks 0.589 average earnings per share of listed companies. Where profits come from? 2/3 from loans and individual housing loans was about 20%-30% per cent of total loans.

banks are also said to be considering is formed in the price decline, rising mortgage interest rates in order to prevent financial risks. Also on the grounds is not sufficient. According to the Supreme People's Court on the people's courts in civil execution sealing up, distraining, freezing regulations on property "owners mortgaged all his house, if the property belongs to the owner of the only residential property, even if the mortgagee (usually a Bank) to recover arrears from the owners, the courts cannot be auctioned, sold or to repay their debts. "Therefore, the falling risks for borrowers of loans has two or more housing loans. For the first home loan, loan risk is only one: the repayment ability of risk. Regardless of price movements is this risk exists. Solution requires all its repayment ability of borrowers to buy mortgage insurance, rather than across the Board, on all first mortgages are rising mortgage interest rates.

loan buyers are middle-and low-income, home prices in their actual expenditure are housing prices and loan interest. Housing prices should not just housing prices, and should be considered for housing prices and mortgage interest, were down by between and. If the loan interest rate rise than the House prices drop more, for those most in need to purchase the first mortgage, this control must be adjusted.

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