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The fall in gross loans made, coupled with a rise in repayment of loans in the month (which increased by 15% to $11.3 billion), resulted in a slower rate of growth of outstanding mortgage loans 1.6% in March compared with 2.7% in February.
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The average rate of growth of outstanding loans in the three months to March also decreased to 30.1% (annualized) from 34.3% in the three months to February. But the average change over the last twelve months remained unchanged at 22.0% in March.
On the other hand, new loans approved during the month rose by 17.0% to $21.1 billion, in line with the revival of primary market activity in March. Loans approved during the month but not yet drawn also increased by 29.7% from $10.9 billion in February to $14.1 billion in March.
"The slower pace of new mortgage lending in March was a reflection of seasonal factors in February. Loan demand accelerated again in March as more new properties were put up for sale, but there are indications that market conditions have since cooled," said Mr David Carse, Deputy Chief Executive of the HKMA. "Despite this we see no need for change to our existing guidelines on loan to value ratios for different types of properties," he added.
The monthly survey also shows that the price-cutting on mortgages further intensified in March. Of new loans approved during March, 53.3% had a margin of 0.25% above best lending rate, compared with 44% in February.
Gross new loans for the purchase of properties in China increased to $195 million in March from $93 million in February. The amount of outstanding loans increased by 0.98% to $6.6 billion.
End
Provisional statistics of retail sales for February 1997
The value of total retail sales in February 1997, estimated at $17.9 billion, decreased by 3% when compared with February 1996. After discounting the effect of price changes over the period, total retail sales decreased by 7% in volume.
These are provisional figures on retail sales released today (Friday) by the Census and Statistics Department.