New mortgage loans in Hong Kong dropped 27 percent month-on-month to HK$14.7 billion (S$2.45 billion) in August, according to the Hong Kong Monetary Authority (HKMA).
Data showed that the value of new home loan approvals declined 10.3 percent to HK$15.8 billion in August. Loan approvals for new property also fell 9.2 percent to HK$2.5 billion, while refinancing loans slipped 5.1 percent to HK$2.8 billion in August.
Mortgage demand for existing properties also declined 11.9 percent to HK$10.5 billion in August.
“The slump in the equity market, banks tightening on mortgage loans, and the disappointing land auction results earlier is dampening potential homebuyers’ confidence,” said Sharmaine Lau Yuen-yuen, Chief Economic Analyst at mReferral Mortgage Brokerage Services.
Meanwhile, applications for new mortgages rebounded five percent to 9,682 cases from 9,211 cases in July.
Lau noted that the drop in new mortgages will continue into the fourth quarter, “as people are anticipating new supply of flats under the Home Ownership Scheme.”
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