A
Chinese flag flies high in Shanghai's Lujiazui Financial District on September 18, 2023.Raul Ariano | Bloomberg | Getty ImagesChinese property stocks surged after top regulators pledged a range of monetary easing measures to alleviate financial burdens and boost the struggling real estate market.During a press conference, People's Bank of China Governor Pan Gongsheng announced reduced interest rates for existing individual mortgages by an average 0.5 percentage points and lowered down-payment ratios for second homes to 15% from 25%.This marks the first time down payments for first and second homes are unified, with the PBOC expecting a reduction in household mortgage payments of around 150 billion yuan ($21.25 billion) annually.The Hang Seng Mainland Properties Index jumped as much as 5% after the announcement, with Hong Kong-listed shares of real estate developers like China Resources Land, Longfor Group Holdings, and China Overseas Land & Investment rising by up to 4.57% and 5.41%.Chinese policymakers have been increasing support for households and the troubled real estate sector, but previous measures have had limited impact.Property-related investment has fallen over 10% in the first eight months of this year compared to last year.The central bank will also guide commercial banks on improving mortgage loan pricing mechanisms and cut the reserve requirement ratio by 50 basis points.Pan said at the briefing that China's housing market still faces significant challenges, with many analysts predicting a long recovery period."It is necessary and urgent to launch supportive measures on all fronts," Bruce Pang, chief economist at JLL, said, but added that authorities must also provide effective support for developers to boost property investment and construction activities.