Mortgage insurance for residential properties in Hong Kong has surged to a 10-month high in April due to increased transactions following the easing of market restrictions.
Newly approved mortgage insurance increased 53% to HK$13.71 billion in value, and applications rose 47% to 2,613 compared to February, according to figures released by mortgage broker mReferral. These numbers mark the highest since June 2023, when HK$16.07 billion came from 2,847 cases.
The increase was driven by an uptick in new and second-hand home sales, which rose by 115% month-over-month to 8,551 units in April, based on the Land Registry’s latest figures.
According to SCMP’s report, the relaxed mortgage financing rules have allowed homes valued under HK$30 million to be eligible for 70% financing, up from the previous 60% for properties between HK$15 million and HK$30 million.
Despite the recent rise in mortgage approvals, the figures are still below last year’s levels. For the first four months of 2024, newly approved mortgage insurance totalled HK$43.43 billion across 8,450 cases, compared to HK$96.91 billion and 17,498 cases recorded during the same period in the previous year.
Tso Tak-ming, chief vice president of mReferral, noted that property transactions rebounded following the removal of cooling measures.
“Property transactions in both the first and second-hand markets have picked up after the withdrawal of all property cooling measures,” he said, as reported by SCMP. “This has led to a significant increase in demand for mortgages, as the proportion of new buyers in the primary market choosing the immediate payment method for uncompleted residential buildings has increased significantly.”
