AMCM head: City’s mortgage delinquency ratio still at low level

By
Stephanie Lai

Following a year of downturn in the city’s residential property prices, the government has made no pledge to tweak the existing mortgage lending rules while Macau’s mortgage delinquency ratio remained low, according to the chairman of the Monetary Authority of Macao, Anselmo Teng Lin Seng.
The call to remove the special stamp duty law and relax the tightened mortgage lending rules implemented in October 2012 was reiterated by the president of the Macau General Association of Real Estate, Chong Sio Kin, yesterday, forecasting that the trend for falling home prices that started last year will very likely persist for this year.
If the fall persists, it could result in a rising number of negative equity cases – especially for homebuyers who purchased their properties in 2013 and 2014, when the city’s home prices rapidly increased, Mr.
Chong remarked to media yesterday at an Association event.
“We will continue to closely monitor the property market,” said Mr. Teng yesterday when asked whether the existing mortgage lending rules will be changed. But he did not pledge any policy changes.
Healthy figures
The government introduced tightened mortgage lending rules in October 2012 at a time when the maximum loan-to-value ratio for property worth MOP6 milllion to MOP8 million was downwardly adjusted from 70 per cent to 60 per cent; for properties worth over MOP8 million, the maximum loan-to-value ratio was further restrained to 50 per cent from the original 70 per cent.
The loan-to-value ratio ceiling for the property worth MOP3.3 million to MOP6 million remains at 70 per cent.
As for the requirement under the local special stamp duty law, property owners wishing to sell property within the first year of purchase are required to pay an extra tax of 20 per cent of the transaction price; the levy is reduced to 10 per cent if the property is sold in the second year after purchase.
“We will have a comprehensive review of the housing market here,” Mr.
Teng told reporters. “The city’s property prices have dropped but we have seen that our mortgage delinquency ratio is at 0.05 per cent. And that the other related figures still remain healthy.”