New Housing Bubble
China's housing bubble
Housing prices are skyrocketing in China’s largest cities. A good example was evidenced in the March average housing prices in Beijing city. Prices in Bejing increased by 60 percent year over year! Property sales for April were down slightly from March’s level but remained 27.5% higher than a year earlier.
To keep the boom from bust, China raised the minimum down payment on second homes to 50% from 40%, told banks they could decline mortgage applications for third homes and increased the supply of land for building low-cost housing. Some cities, such as Beijing and Qingdao, have since announced even more-stringent policies.
Home Mortgage Rates Fall
home mortgage rates
Frank Nothaft, Freddie Mac vice president and chief economist said: “Rates for both the 30-year and 15-year fixed-rate mortgages were the lowest in six weeks; initial rates on 5/1 hybrid ARMs hit an all-time low since they were added to the survey in the beginning of 2005. The homebuyer tax credit helped support home sales in March, and anecdotal reports point to strong April sales as well. Pending existing home sales rose for the second consecutive month in March to the strongest pace since October 2009, just before the original deadline for the credit, based on figures published by the National Association of Realtors.”