(ECNS) -- Sixteen commercial banks in Beijing have hiked lending rates on first homes, requiring them to be no less than 95 percent of the benchmark lending rates, up from the previous “no less than 90 percent,” Beijing Youth Daily reported on Wednesday.
The hike will translate to a 120,000 yuan (,400) increase in interest payments on a 25-year loan on a 3 million yuan first home.
The move comes on the heels of a new housing rule issued by Beijing to limit financial risk and promote the steady and healthy growth of the home-loan business.
The 16 banks are: Industrial and Commercial Bank of China, China Construction Bank, Bank of China, Agricultural Bank of China, Bank of Communications, China CITIC Bank, China Merchants Bank, China Minsheng Bank, SPD Bank, Industrial Bank, China Everbright Bank, Huaxia Bank, Postal Savings Bank of China, the Beijing branch of China Bohai Bank, Bank of Beijing, and Beijing Rural Commercial Bank.
Industry insiders said some other banks may also up their lending rates to benchmark levels.
A separate new rule, set to take effect on April 10, forbids the division of a bungalow room into several partitions. The rules requires all lanes in a bungalow to be marked out in a property's registration, as Beijing moves to tackle “lane homes” in the sizzling school-district housing market.